CHEQUE BOOK

HT Estates - - HTESTATES - Harsh Roongta

I need a home loan and my salary is ₹ 32,500. I also earn some in­cen­tives. What are the op­tions avail­able to me?

— Sharad Ahuja Lenders nor­mally con­sider the in­cen­tives if they see that you have con­sis­tently earned size­able amounts (of in­cen­tives) over con­sec­u­tive quar­ters in the past. How­ever, there might be vari­a­tions in terms of the ex­act amount. If this is the case, your in­cen­tives shall most def­i­nitely be taken into ac­count while cal­cu­lat­ing your loan amount el­i­gi­bil­ity.

On the ba­sis of ITR/Form 16 of the last two years, you can get up to 4 to 4.5 times of your an­nual gross in­come (that in­cludes in­cen­tives and other vari­able in­come com­po­nents) as a home loan or up to max­i­mum of 80% (90% for loan amount be­low ₹ 20 lakh) of the agree­ment value of the prop­erty as a home loan. The over­all el­i­gi­bil­ity will be based on your in­come, your regular outgo- I availed a home loan from a pri­vate bank in De­cem­ber 2012. The vari­able rate of in­ter­est was 10.5% and the EMI started from Fe­bru­ary 1, 2013. How­ever, be­fore my first EMI, RBI had re­duced the rate for new loans to 10.25%. Hence, I did not get the ben­e­fit. The same bank in­creased the ROI to 10.75% in Septem­ber 2013 with­out any in­ti­ma­tion and con­se­quently my 20year long EMI has now in­creased to over 21 years.Can the bank do this with­out in­form­ing me and will my rate of in­ter­est be re­duced as per the re­cent rate cut by RBI?

— Sa­garika Dhu­lia The changes in RBI pol­icy rates do not au­to­mat­i­cally im­pact changes in the lender ref­er­ence rates.

It is a known fact that lenders are hes­i­tant to re­duce the base rate (BR) when in­ter­est rates fall and hence the con­sumer rarely gets the ben­e­fit when the in­ter­est rates are re­duced. To say the least, this does not hap­pen im­me­di­ately.

How­ever, at any given point of time, if you feel that the rate of in­ter­est be­ing charged on your loan is higher as com­pared to the pre­vail­ing mar­ket rates or the rate be­ing of­fered to new cus­tomers, you can trans­fer your ex­ist­ing loan to an­other lender.

You will need to have a good track record of pay­ment of your EMIs in or­der to se­cure an of­fer from an­other bank that will re­place your ex­ist­ing loan. No pre­pay­ment charges are payable on trans­fer of a float­ing rate home loan for banks and hous­ing fi­nance com­pa­nies presently.

How­ever, you may have to pay some pro­cess­ing fee to the prospec­tive lender. Re­mem­ber not to pay pro­cess­ing fees plus legal fees and val­u­a­tion fee more than 0.50% of the loan amount or ₹ 10,000/ (whichever is lower) plus ser­vice tax. I want to take a home loan in which I want my wife to be the co-ap­pli­cant (50:50). What doc­u­ments are re­quired to prove that my wife and I are pay­ing EMI in the same ra­tio? Will it be men­tioned in the loan doc­u­ments?

— Rohan Man­dar In case of a jointly owned prop­erty and a joint loan, each of you can claim tax benefits to the ex­tent of your re­spec­tive shares in the loan. In case the share of each per­son is not de­fined in the prop­erty agree­ment, you can record the same by way of a sep­a­rate agree­ment to spec­ify a cer­tain per­cent­age. How­ever, this is not re­quired to be men­tioned in the loan doc­u­ments.

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