HT Estates - - HTESTATES - Harsh Roongta

I am look­ing to pur­chase a res­i­den­tial property (3BHK) in NCR. There are three op­tions of pay­ments: down pay­ment plan, con­struc­tion-linked plan, and sub­ven­tion plan. Please ad­vise on sub­ven­tion plan ad­van­tages as com­pared with other two op­tions.

—Ritesh Chaud­hary Note that the risk of any de­lay in con­struc­tion is on you so please do not agree on a full down pay­ment of­fer in ex­change for a price dis­count. No dis­count can jus­tify the ad­di­tional risks you take on this ac­count. It is al­ways ad­vis­able to go for a con­struc­tion-linked plan for property to en­sure that your ex­po­sure is in pro­por­tion to the stage of com­ple­tion of the property rather than dis­pro­por­tion­ate. Ac­cord­ing to most in­ter­est sub­ven­tion schemes in the mar­ket, a buyer does not pay any EMI dur­ing the con­struc- tion stage of the property for the first two years of the loan pe­riod. The pre-EMI in­ter­est for th­ese first two years will be paid by the builder/ de­vel­oper.

Also keep in mind that the bank does not guar­an­tee on-time con­struc­tion of the property and you will be held li­able if the con­struc­tion is de­layed or if the builder de­faults on the pay­ment of in­ter­est to the bank. Re­mem­ber, any de­fault by the builder in pay­ment of preEMI in­ter­est will se­verely af­fect your per­sonal credit score.

I’m buy­ing a com­mer­cial shop worth ₹ 50 lakh. I’ve al­ready paid ₹ 25 lakh for it and want to avail a com­mer­cial loan of ₹ 25 lakh. A bank is ready to give me the loan. Please ad­vice on the loan pro­ce­dure and in­ter­est rate of­fers?

-Suresh Menon Dif­fer­ent banks pre­sume cer­tain por­tion of your in­come as avail­able for pay­ment of EMIs of loans. It varies from bank to bank and there is no stan­dard norm/for­mula. But nor­mally the bank will as­sume that around 40% to 45% of your net salary is avail­able for pay­ment of EMI to serve all the loans. In case you have an ex­ist­ing loan it will have an im­pact on your loan el­i­gi­bil­ity.

The banks are very se­lec­tive in grant­ing loans for pur­chas­ing any com­mer­cial property. You can ap­proach any com­mer­cial bank or NBFC for grant­ing the loan to pur­chase a com­mer­cial property. The rate of in­ter­est on such loans is higher than reg­u­lar home loans. Nor­mally banks fi­nance up to 60% to 80% of the property cost as a loan and the float­ing rate of in­ter­est starts from 12% pa. The loans are given for a max­i­mum ten­ure of 15 years.

NBFC are more ac­tive in this sphere than large com­mer­cial banks. You will have to sub­mit proof to the bank that the property has been al­lot­ted for com­mer­cial pur­pose. A few banks of­fer loans for pur­chase of com­mer­cial property at 11.75% to 14.00% pa while oth­ers of­fer in­ter­est rates of 10.85% to 12.6% pa for a max­i­mum ten­ure of 15 years. With a monthly in­come of ₹ 40,000 you should be el­i­gi­ble for ₹ 15 lakh at the rate of 12 % per an­num for 15 years ten­ure (as­sum­ing you are less than 45 years of age) and have no other loans.

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