Federal Bank NRI Home Loan

Federal Bank NRI Home Loans

NRI Loans: Loans for Non Resident Indians

Hundreds of Indians immigrate to different countries each year for work, higher studies or business opportunities. This migration has led to thousands of families located in North America, Europe and Middle East.

Coined as NRI (Non-Resident Indians) are people who have an Indian passport and are living abroad for a long time (more than a year) for work, studies or other legal purpose. According to FEMA an NRI is “who resides outside India for employment, carrying on business or vocation in circumstances as would indicate an intention to stay outside India for an indefinite period”. It also mentions that any Indian who hasn’t lived in India for more than 182 days during that financial year he/she is considered an NRI.

It is to these people that banks like Federal Bank provide home loans at competitive and exclusive interest rates.

Federal Bank NRI Home Loan

An NRI home loan will follow the same structure as a normal home loan with the loans being repaid in Equated Monthly Instalments (EMI). The difference arises in the interest rate and tenure, where the interest rate for NRIs is slightly higher and the loan tenure is lower than compared to home loans provided to Indian residents.

The NRI home loans have lower tenure as the borrowers earn a handsome income which indicates a higher repaying capability. Moreover, most of the NRI borrowers wish to close the loan at the earliest.

Benefits of Federal Bank NRI Home Loans

Speedy loan approval
Get loan up to 85% of project cost
Minimal paperwork
Loan amount up to Rs.1500 Lakhs
Longer repayment period

Federal Bank NRI Home Loans Eligibility Criteria

The NRI home loan is offered to people who have been living outside India whose loan tenure, loan amount sanctioned, and interest rate will depend on the customer’s profile, age of customer at maturity of loan, age of property at loan maturity, depending upon the specific repayment scheme as may be opted and any other terms which may be applicable based on prevalent norms of Federal Bank.

Age: Minimum 21 years of age and maximum 60 years of age at the time of loan maturity

Residential status:

Salaried – Should have lived abroad for at least 1 year

Self-employed – Should have lived abroad for at least 3 years

Loan Tenure: Maximum loan tenure of 20 years for both salaried and self employed

Loan Amount: Rs.1500 lakhs subject to repayment capability and income

Margin

Loan Amount	Margin	LTV Ratio
Loans up to Rs.30/- Lacs	10%	90%
Loans above Rs.30/- Lacs up to Rs.75/- Lacs	20%	80%
Loans above Rs.75/- Lacs	25%	75%

Fees and charges for Federal Bank NRI Home Loan

Product/Service	Fees
Interest rate	Starts from 8.60%
Processing Charges	1% of Loan amount
Prepayment charges	Nil

Documents Required for Federal Bank NRI Home Loan

KYC documents

Proof of Identity – Copy of valid Passport
Copy of valid Visa for continuance of employment
Copy of valid address proof
Passport size photos of the applicant and / co-obligant - Two copies each.

Proof of Income

NRE a/c statement with us/other banks for the past two years.

Salaried NRI's shall produce Embassy attested Salary Certificate/Slip

For non-salaried NRI's, Balance Sheet/Profit & Loss Account for the past two years shall be submitted.

Other documents

Documents of Title - i.e., Tittle Deed & Prior Deeds
Encumbrance Certificate (13 Yrs.) From Sub. Registrar Office
Land Tax Receipt (Latest)
Possession Certificate
Approved Building Plan
Property Sketch
Any other documents as required by the bank

For Purchase of Ready Built House / Flat

Agreement of Sale
Building Tax Receipt (latest)
Any other documents as required by the bank

In the case of flat/villas, following documents are also needed:

Sale & Construction Agreements (original)

Letter of Allotment from the Builder

Tripartite Agreement – Where the flats are under construction & the possession is not immediate

Any other documents as required by the bank

For House Construction / Extension / Repairs & Renovation:

Estimate report from Civil Engineer / Architect Permission for Construction from local authorities
Any other documents as required by the bank

Important factors NRIs need to remember before applying for a Home Loan

Loan Repayment

As per RBI rules Repayment must be done in rupees through an account in the India or utilizing NRE or NRO accounts. If the property is rented out the rent receipt can be used against the Equated Monthly Instalments (EMI)

Tax benefits

As with resident Indians NRIs can also avail tax benefits on home loans under section 24 and 80c. NRIs can get tax exemption on the interest paid for a maximum of Rs. 2,00,000 and Rs.1,50,000 on the principle paid under section 80c. If it is a joint loan taken with another NRI or resident Indian/s then each member can avail for the tax benefits separately.

Restrictions in property owned

The Government of India has stipulated that an NRI can only own 2 houses in India. That is, they can own only 2 properties for residential purposes. Even if the properties are rented out they can only own two. They can own any number of commercial properties while they cannot own land for agriculture.

Federal Bank Home Loan EMI Calculator

To know how much you will have to pay as EMI on Federal Bank home loan, you can visit the official website of the bank. Go to ‘Tools and Calculators’ page where you will find the option for ‘Home Loan EMI Calculator’. After entering the page, you will find three fields where you need to enter the following details: 1) Loan Amount, 2) Interest Rate and 3) Tenure in years.

After entering the necessary details, the calculator automatically calculates the loan EMI amount to be paid and delivers the result on the same page. It takes less than a minute to check the EMI amount against the home loan to be taken.

You can also view a similar home loan EMI calculator on CreditMantri website and apply for the loan directly. You will find the results of total amount payable with interest and interest payable separately.