The guide to meaningful investments

With Interest Rates at all time low, this is the right time for everyone to own their dream home. Paradise homes can be financed through leading financial institutions & banks. Please contact us to get details of approval numbers for our various ongoing projects & any other details at info@charmsgroup.in

How do I apply for a Home Loan?

Step 1: Approach a Housing Finance Company with the latest salary slip and TDS Form 16 of the last two financial years of yourself and your co-applicant. The loan officer will informally tell you the amount of loan you are eligible for, the areas in which they finance flats and the terms of the same. Collect a loan application form and confirm the needed documents (mainly proof of income). Visit more than one company since you are likely to get better terms / larger loan amount if you shop for the best deal.
Step 2: At your chosen HFC, submit the duly filled loan application, along with the requested documents and an application fee (around 1%). They will then interview you on the same. After conducting an appraisal of your application, the HFC will give an in-principle sanction of your loan.
Step 3: You now have to submit your property documents, which should show a clear title. The HFC will check these and levy an administrative fee (around 1%). It will then disburse the loan, either fully or in installments, directly to the builder / seller of the flat.

How much housing loan can one get?

It depends on a person’s repaying capacity based on your income. You can add your spouse's income to increase the amount of loan.

What tax benefits are available in regards to the housing loans?

Tax benefits are available to consumers of house loans for the interest component as well as principal component of the housing loans. The current budget has left the upper limit of the interest payment deduction at Rs. 1,50,000 per annum. The section 80C also allows tax benefits on principal repayments.

What is the reducing balance method of interest payment?

In reducing balance you reduce the amount of principal payment already paid by you from the initial loan amount. You pay interest only on principal unpaid till that point of time and not the entire loan amount.

What is floating interest rate?

In a floating interest rate, you interest payment will vary according to the market lending rate. If interest rates rise your interest payments will rise and vice-versa. You bear the risk of interest fluctuations in the market. Floating rates are slightly cheaper than fixed interest rates.

What is fixed interest rate?

In a fixed interest rate, your interest rate is fixed over the entire tenure of loan.

Real estate Solutions for NRI's

Who is an NRI?

Any person of Indian origin (Indian Citizen) living abroad for purpose of education, employment, carrying on business etc. for an long duration abroad is a non-resident Indian. Non-residents foreign citizens of Indian Origin are also treated on par with non-resident Indian Citizens (NRI's) for purpose of certain facilities.

Do non-resident Indian Citizens require permission of Reserve Bank to acquire residential / commercial property in India?

No. Non Resident Indians are allowed to make real estate investments in India without any cap on quantity or the number of investments.

What payment modes can an NRI use for paying for the property?

There is no restriction or condition on payment on buying a property. The normal banking channels are applicable.
- FCNR (Foreign Currency Non-Resident accounts) in India.
- Remittance from abroad through normal banking channels.
- NRO accounts in India. (Deposits in dollars opened by residents or non-residents)
- NRE (Non Resident External Rupee accounts)

What are the regulations for purchase of property?

FEMA stipulates that before making a purchase, special form called the IPI 7 needs to be filed with the central office of the RBI along with the title deed or any other certified copy of the document proving that the NRI has executed an agreement to purchase the property within the country within 90 days of the purchase of property along with bank certificate stating consideration paid for the purchase.

Do foreign citizens of Indian Origin require permission of Reserve Bank of India to purchase immovable property in India for their residential use?

Reserve Bank has granted general permission to foreign citizens of Indian Origin, whether resident in India or abroad, to purchase immovable property in India for their bona fide residential purpose. They are, therefore, not required to obtain separate permission of Reserve Bank.

Can returns from realty or sale proceeds be repatriated?

FEMA says no matter what the proceeds of the sale may be, the amount for repatriation should not exceed the amount paid for acquisition of the immovable property in foreign exchange received.

Can NRI's obtain loans for acquisition of a house/flat for residential purpose from financial institutions providing housing finance?

The Reserve Bank has granted general permission to certain financial institutions, like HDFC, LIC Housing Finance Ltd., to grant housing loans to non-resident Indian nationals for acquisition of houses/flats subject to certain conditions.
Source: Property Matters Made Easy, IndiaProperties Institute of Real Estate

The Registration process

Stamp Duty is a tax collected by the Government on every document by which any right, title, interest or liability is created, transferred, extended, extinguished or recorded. Since the values of transactions in the real estate market tend to be quite high, the amount of stamp duty is also a large amount.
Only exception to Stamp Duty is when the property is transferred through "Will" of a deceased person. All other transfer documents like agreement to sell, development agreement, Conveyance Deed, Gift Deed, Mortgage Deed, Exchange Deed, Deed of Partition, Power of Attorneys, lease deeds, etc. have to be properly stamped before registration.