Q. Can a prospective buyer apply for a housing loan even before selecting the property?
Ans: Yes. A prospective buyer can apply for a Housing Loan even before selecting the property / finalizing it. In such a case in-principle approval for the loan amount is to be given which helps the applicant in deciding his budget. This in-principle approval is valid for 3 months. It should clearly specify that the Bank is under no commitment/obligation and the actual sanction/disbursal depends upon several factors like legal/technical clearances, value & acceptability of the property to be financed & creation of valid equitable mortgage, etc.
Two Loans:
Q. Can two loans be given to one individual?
Ans: Yes. Two loans may be given to an individual provided he/she has the capacity to repay. The two loans may be given simultaneously or at different times either for purchase/construction and subsequent repair/renovation of a single property or for purchase/construction/repair/renovation / of two different properties.
Property at a different location:
Q. Can loans be granted at a center different from the location of the property?
Ans: Yes. Where the loan is granted to employees of reputed companies, preferably with a check-off facility, the loan should be granted by a branch at the center where the employee works, and the account should move along with him. The mortgage should however be created by a branch where the property is located. However, where the sanctioning authority is satisfied with ensuring regular repayment of the loan by establishing a check-off with the employers of the borrower under which the EMI is remitted regularly, the loan can be selectively granted at the place where the property is located. This discretion is to be used judiciously.
Old House / Flat:
Q. What are the additional instructions relating to loan proposals for the purchase of old house / flat?
Ans: a) In addition to the usual prescribed documents for Housing finance, the under noted 2 documents should be obtained, the expenses of which should be borne by the borrower:
i) Valuation Certificate from a Government approved valuer.
ii) Certificate from the Government approved architect / structural engineer regarding the condition of the house/flat. The life and the condition of the house should be such that the Bank’s security coverage is not affected till full repayment of the loan.
b) Further, if the house/ flat is more than 10 years old, proposals require administrative clearance of the Zonal Manager,
Quantum of Loan
Monetary Ceilings::
Q. What are the monetary ceilings on loans for plots alone or for repairs/renovation or furnishings/consumer durables?
Ans: Loans for plots alone or for repairs/renovation: Rs.20 lacs: Under SBS reality loans up to Rs.20 lacs can be given for the purchase of land for the construction of the house.
Loans for furnishings and consumer durables: 10% of the project cost or Rs.3 lacs whichever is less where a check-off facility or additional security or 3rd party guarantee good for the amount is available.
Clubbing of income:
Q. Income from which sources can be included in the NMI/NAI to arrive at the Total Eligible Loan Amount?
Ans: Income from the following sources can be considered to enhance the total eligible loan amount :
a) Income of spouse: where
The property is held jointly and the spouse is a co-borrower.
The property is held in a single name and the spouse stands as a guarantor.
b) Income of Son/Daughter: If he/she is working in a reputed Organisation and is a co-borrower / guarantor.
The husband, wife, unmarried children, and married son living with the parents, are considered as close relatives. As such if a son/daughter is in employment and wants to be a co-borrower there is no difficulty as long as his / her salary is routed through us and the property is validly mortgaged to SBS.
c) Expected Rental: Fewer taxes, cess, etc. in the case of house / flat being purchased if it is proposed to be rented out.
d) Other Income: Regular income from all sources provided the sanctioning authority is satisfied with the proof of income.