Type Of Home Loan In India

Type of Home Loan

The procedure for the approval of type of home loan in India, depends on the purpose for which you need it. Details of which are listed below. First you should decide what type of loan would be suitable for you before applying for it.

LOAN TYPE

DESCRIPTION

Home Purchase Loans

 This is commonly known as home loan or housing loan. It’s provided for buying houses or an apartment. Bank typically offers 75 to 90% of the market value of the property and are available for various tenure periods with fixed and floating interest rates.

Home Construction loans

 This loan is for construction on a lease hold / freehold plot or on a plot allotted by a Development Authority. It  is a unique experience and has myriad benefits in constructing your own home. With Home  Construction Loans, you can build your home your own way to match your family’s needs.

Home Improvement loans

 As the name suggests this type of loan is to take care of their home renovation work ie. extension or  construction or renovation work of existing homes. Example for this is extending a room, flooring work, painting, making a new balcony, all kinds of plumbing or exterior elevation works are all covered under home improvement loans.

Home Extension loans

 This loan is suitable for people who want to expand their current house such as altering the sizes of a room or adding more room(s), creating a floor, a larger balcony or extending the bathroom. Some banks refer to these as home improvement loans.

Land purchase loans

 This loan is available for purchase of empty plot or land for residential activity, construction or investment purpose but are not available for buying any agricultural plot of land.
Land loans offer a LTV(loan to value) ratio of up to 80% in most cases unlike home loans which offer a LTV ratio pertaining to 80 to 85% of the price of the property, .

Bridge loans

 It is useful for people who plan to sell their existing property and use this funds either to upgrade their homes or buy a new home. In this case it isn’t essential to wait till the time existing property is sold but you can use bridge home loan to purchase the new home and repay the bank once the existing home is sold.

Balance transfer loans

 It is transfer of a high interest rate home loan from one bank to another. These days it is a common practice among customers. Many home loan borrowers opt for a Loan Balance Transfer to take advantage of the prevailing low/competitive interest rates with other banks in the market.

NRI home loans

 These are the special kind of home loans meant to help NRIs acquire finance for buying residential property in India. Paperwork over here is more elaborate than regular home loans.

Loans Against Property

 A loan against property (LAP) is as the name implies : is a loan given against the mortgage of property. The loan is given as a certain percentage (around 40 per cent to 60 per cent) of the property’s market value.

Lease Rental Discounting

 A term loan offered against rental receipts derived from lease contracts with corporate tenants is called LRD or Lease Rental Discounting . This loan is provided to the lesser based on the the underlying property value and discounted value of the rentals.

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Home Loan

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Land Purchase Loan

Top-Up Loan

Balance Transfer