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HT Estates - - Front Page - Harsh Roongta

I am 55 years old. What’s the age limit for a loan ap­pli­ca­tion?

—Lal Kr­ishna Most banks have a max­i­mum age limit of 60 years for salaried in­di­vid­u­als since that’s the re­tire­ment age and 65 years for the self­em­ployed. The max­i­mum ten­ure is re­stricted by the age of the bor­rower at the end of the ten­ure so as to en­sure that the loan gets fully paid on or be­fore the re­tire­ment age. How­ever, some lenders like HDFC do have step down plans where the EMI is higher till the age of re­tire­ment and then lower af­ter re­tire­ment as­sum­ing the loa­nee is el­i­gi­ble for pen­sion. How­ever, it is likely that the loan ten­ure will be re­stricted to five years (if salaried). You can take a joint loan with your earn­ing spouse or chil­dren to in­crease the loan el­i­gi­bil­ity and en­sure the loan is avail­able for a longer ten­ure. I took a home loan in 2002 and re­paid it in 2011. But now I want to take a loan to con­struct one floor. Can I get a re­bate in in­come tax un­der 80c and 24b again and what are the other con­di­tions?

—Manoj Juneja Yes, you can claim the ben­e­fits un­der Sec­tion 24b and 80c for con­struc­tion of the first floor in your ex­ist­ing prop­erty sub­ject to the ful­fill­ment of other con­di­tions such as com­ple­tion of con­struc­tion within three years from the date of your first dis­burse­ment. In case this is let out you will get full in­ter­est ben­e­fit but in case it is used for your res­i­dence your claim shall be re­stricted to R1.5 lakh per year. What is the max­i­mum amount of loan given by the banks for a re­sale flat? My an­nual CTC is R3.5 lakh. How much amount of loan I am el­i­gi­ble for?

—Swati Shetty You can get a home loan to buy a re­sale prop­erty based on your in­come, value of the prop­erty and the ti­tle of the prop­erty. The age and the con­di­tion of a build­ing also have a bear­ing on loan el­i­gi­bil­ity. The banks are nor- mally re­luc­tant to lend­money for a prop­erty, which is very old. How­ever, if the prop­erty is in good con­di­tion, there should not be any prob­lem in get­ting loan from any bank. Please note that most banks get the prop­erty val­ued in­de­pen­dently and they will give you home a loan based on the value ar­rived by their val­uer rather than the value men­tioned in the pur­chase agree­ment. Fre­quently, the val­u­a­tion as de­ter­mined by the banker’s val­uer is sig­nif­i­cantly lower than the ac­tual cost and hence your ef­fec­tive down pay­ment goes up.

As a thumb rule, if you are be­low 40 years, you should be el­i­gi­ble for around four times your net an­nual in­come (in your case around R15 lakh) up to a max­i­mum of 80% (90% for loan less than R20 lakh) of the agree­ment value of the prop­erty for 20 years ten­ure. While as­sess­ing your el­i­gi­bil­ity the banks will take into ac­count any ex­ist­ing loan be­ing ser­viced by you. Please note, Your EMI – in­clud­ing other loans – should not ex­ceed 40-50% of your net monthly in­come.

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