The technology has covered leaps and bounds today. It has also opened up a gamut of opportunities for working individuals. There is an increase in non-resident Indians. If you are one of them, you st…

The technology has covered leaps and bounds today. It has also opened up a gamut of opportunities for working individuals. There is an increase in non-resident Indians. If you are one of them, you still have ways to connect with your home country. Banks offer several products to facilitate that.

They also provide an NRI Home Loan to assist in buying property in India. The application process for the same is simple, with minimal criteria. But remember some aspects to make the most of the credit option:

Power of attorney: As you reside in a foreign country, you need a representative in India. The person you select is known as the Power of attorney. Although not a compulsion, lenders insist on this for NRI Housing Loan. It helps them complete formalities in your absence. You must choose a close relative, spouse, guardian, or parent for this role. Once done, the bank contacts the said person for any physical communication.

Eligible properties: You apply for a Housing Loan for all kinds of properties. These include under construction plans, ready-to-move homes, plots, etc. The repayment terms differ for them. You also get to borrow funds for renovation, redevelopment, and expansion purposes. However, a Loan for NRI in India is not applicable for agricultural land, farmhouses, plantations, etc., under the Foreign Exchange Management Act regulations.

Documentation: The Home Loan application for NRI is pretty simple and involves minimal paperwork. You also get to apply online within minutes without visiting India. The key is to keep the documents handy. The standard requirements include a passport copy, work permit or Visa, residence proof, salary slips. Income tax return certificate, NRI Accounts, bank statements, etc.

Loan to value ratio: It decides the borrowable amount you get from the loan providers. You usually get a portion of the property value as the loan amount. The rest gets borne by you. Lenders generally sanction up to 75% to 90% of the property value as a Home Loan for NRI. The exact amount depends on your eligibility and creditworthiness. Besides, you can stretch the margin at your end. It helps reduce the interest cost.

Repayment source: The fund used for repayments must come from the Non-Resident External (NRE) or Non-Resident Ordinary (NRO) Account. Lenders insist on these sources as the funds must be in Indian currency. You could make direct remittances to the Bank Account or use other Indian income sources. But they cost higher than the NRI Accounts. Hence, it is best to open these accounts for easy repayment of the NRI Housing Loan.

https://www.bankofbaroda.in/baroda-home-loan-for-nri.htm

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