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As the name indicates, land loan or plot loan is provided by banks and NBFCs for purchase of land which can be used for building a house or commercial purpose. The land is a good investment as it has better returns at the resale.
Indian Bank, one of the popular banks in India, offers land loans to varied individuals for various purposes. If you are looking for a plot loan for construction of a house, Indian Bank could be a viable option to start with.
Purpose: Plot loan is offered to individuals based on site ownership and the property should be approved by the competent authorities.
Loan Amount: Generally, the bank offers up to 30 times of the monthly gross income. However, the loan amount differs based on the demographic profile. Applicants from rural area can get up to INR 50 Lakhs, for semi-urban area – INR 100 Lakhs, urban area – INR 200 Lakhs, metro area – INR 300 Lakhs.
Margin: 25% of value of the land to be purchased
Processing fee: The borrower will have to pay 1.173% of the loan amount as processing fee.
Loan Tenure: The maximum repayment period is up to 15 years.
Prepayment Charges: You can foreclose the loan before the completion of the tenure. There are no charges levied for prepaying the loan.
Following are the eligibility criteria that one must fulfil to get plot loan from Indian Bank
Age Limit: The applicant should be between 18 to 60 years of age with good repaying capacity.
Nationality: Should be an Indian resident
Profession: Salaried or self-employed individuals who should be in the current employment for a consistent period of time
All the documents required for a home loan will be necessary for land loan as well. Following are some of the important documents to be submitted
The borrowers can get the following benefits on Indian Bank Land loan
Quick Approval: It is easy to apply for the loan and the approval is done quickly after the verification process.
Low Interest Rate: You can get the best interest rate in the market based on the credit profile.
No Hidden Cost: No additional costs are charged more than the standard charges
Interest Rate: The interest rate is fixed at the sole discretion of the bank. It is subject to change depending on the credit profile of the borrower.
Processing Fee: 1.173% of the loan amount
Prepayment charges: Nil
Most of the times land loan is confused with the home loan as the features and benefits are similar in nature. However, we have spot out some of the differences that every borrower must know before applying a land loan.
Difference 1: A home loan is provided for a property that is built, under construction and or undergoing restoration and extension, while a land loan is predominantly given for purchase of a piece of land or plot
Difference 2: The Loan to Value ratio for a home loan is about 80%, for loans above 3 lakhs the LTV is 90%; while the LTV for a plot is 50-70%
Difference 3: The tax benefits which are available on a home loan are not available on the land and plot loans
Difference 4: Home loans tend to be longer up to 30 years even, while the land plot loans are extended up to 15 years
Difference 5: Another factor that is considered while taking up a land loan is the presence of 2-5% of foreclosure charges that are absent in a home loan. These are the primary differences between a home loan and a land loan.
For any loan applicant, a credit score is an important facet that is considered by banks and other lenders when they are about to make lending decisions for any loan including your land loan. It is the onus of the applicant to maintain a good credit health especially for those who are looking to take big ticket and medium to long term loans, the presence of a poor credit score or no credit score could lead to unwanted situations such as unfavourable terms or sometimes even rejection.
To avoid loan rejection, learn more about your credit health, start with your free credit score.
Before a person applies for an Indian Bank land loan it is best to do an eligibility check which is available on the Indian Bank website and at CreditMantri.com This way your credit score will not be affected as the bank will only soft pull your credit score and compares with other internal criteria to make sure you are eligible.
Customers can use the home loan EMI calculator to know how much EMI they will be paying each month. Customer can make use of the CreditMantri Home Loan EMI calculator and the lender Home Loan EMI calculator.
The importance of this is that customers will know how much EMI they will have to pay based on their loan requirement. This helps them to plan far ahead.
CreditMantri’ s Home Loan EMI Calculator and lender Home Loan Calculator are among the best and probably the easiest ways to compare various home loan offers and choose the loan best suited to your requirements. Using the Home Loan EMI Calculator, you get a simple and quick way to accurately compare the various loans and determine what your EMI will be with the different lenders.
1. How long will it take for Indian Bank land loan approval?
It will take at least 1 week for the bank to do their due diligence and verify all the documents.
2. How can I apply for a land loan from Indian Bank?
Indian Bank provides customers multiple ways to apply for a land loan. It can be from anywhere using the online and customer care facilities or visit the nearest branch to talk to a representative to discuss the options and then apply. Customers can choose any one of the option they are comfortable with.
3. What is the maximum loan amount I can get from Indian Bank Land Loans?
The maximum loan amount from Indian Bank land loans is Rs.3 crores.
4. What is the processing fee for Indian Bank land loans?
The processing fee is up to 1.173% of the loan amount with GST.
Indian Bank is an Indian state-owned financial services company established in 1907 and headquartered in Chennai, India. It has 20,661 employees, 2594 branches and is one of the top performing public-sector banks in India. It has overseas branches in Colombo and Jaffna in Sri Lanka, and in Singapore, and 223 correspondent banks in 71 countries. Since 1969 the Government of India has owned the bank.
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