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Home Improvement Loan
Purpose
“Home Improvement Loan Scheme” provides a packaged financial assistance to individuals for furnishing their houses / flats at incredibly low rates of interest."
- For purchase of household furniture items, refrigerator, fans, air conditioner/s, to put up wardrobes or any other household item/s.
Eligibility
- Owners of House / flat who are salaried individuals / individuals engaged in business / professionals / self-employed. NRIs are also eligible.
- Salaried individuals should have a minimum monthly net take home salary of 25% of their gross salary or Rs. 2000/- after meeting the loan instalments for the proposed loan.
- Professionals and other non-salaried persons should have a minimum annual income of Rs. 50000/- to be evidenced by Income Tax assessment order / return.
QUANTUM
- Upto 20% of total Housing Loan sanctioned amount OR One Year’s Gross Salary/Gross Income whichever is less.
Margin
- If the loan under this scheme is availed as a part of housing finance, then, the margin as stipulated under housing finance may be prescribed for this loan too. In other cases, a uniform margin of 20% may be stipulated.
- In the case of Repairs & Renovations, expansion of existing unit, upgradation and creation of additional amenities, a uniform margin of 25% on project cost is applicable. The margin is stipulated on the total project cost.
- In case of Housing Loans where project cost is up to Rs.10 lacs, Stamp duty, Registration Charges and other Documentation Charges can be included in the project cost for the purpose of stipulating margin as well as LTV ratio.
- Where the project cost exceeds Rs.10 lacs, the margin is stipulated only on the basic project cost which shall not include expenses towards Stamp Duty, Registration and other Documentation Charges.
Net Take Home: Salaried-> Minimum percentage of Net Income/NTH 25% (after EMI) with a minimum amount of Rs.10000/-.
Rate of Interest
Security
- Hypothecation of assets created out of this loan.
- Mortgage of house / flat
- Suitable co-obligation / personal guarantee. Waiver considered selectively.
Repayment
- Residual tenure of underlying Housing Loan OR 7 years, whichever is lower, subject to borrower attains the age of 70 years.
Processing Charges
- The processing charges payable is 0.5% of the loan amount subject to a minimum of Rs. 1500/- and maximum of Rs. 10000/- (subject to change from time to time)
Disbursements
- Amount will be normally disbursed only after acquiring ready built house / flat or completion of construction of house / flat or completion of repairs / renovations, etc., where the loan is availed along with housing finance. In case this loan is sanctioned independent of a housing loan then, the loan can also be disbursed against proforma invoice, etc.
Documents
- Stipulated Loan application with 2 passport size photographs
- Latest Salary Certificate and Form No.16
- ITAO / IT Returns (for professionals and non-salaried persons)
- Proforma Invoices, cost estimates