Various private and public sector banks are coming out with attractive loan plans for its customers for purchase of land, purchase or construction of house/flat. The loan can be taken for both land purchase as well as construction on the land.

Eligibility for Land Purchase Loan:

Any individual aged 21 years or above having regular income is generally eligible to apply for land Purchase loan.

Maximum Amount of Loan:

The quantum of loan sanctioned, depends on a number of factors like the cost of house/flat, person's age while applying for loan, income, repayment capacity etc. Loans of higher amount may be considered on the basis of merit of the case. The loan can then be repaid through Equated Monthly Installments or EMI. The loan is payable maximum in years.

Margin for purchase or construction of new house/flat:

Minimum 15% of the project cost for individual
Minimum 10% of the project cost in case wife joins as co-borrower

Margin for purchase of old house/flat/land:

Minimum 30% of Purchasing value. This value may vary from bank to bank.

Interest on Land Purchase Loan:

Interest on both fixed as well fluctuating rates are available. The actual interest rate is governed by prevailing market conditions at the time of taking loan. Special reductions in interest rates may sometimes be allowed for women and in other special conditions. A nominal processing fee of 1% of amount of loan taken is generally charged by banks.

Documents Required for Approval of Land Purchase Loan:

Businessman/ Self employed professional:

1. Application form with photograph
2. Educational qualification
3. Identity and residence proof
4. Proof of business existence with business profile and last three years income tax return
5. Last 3 years income statement and balance sheet.
6. Last 3 month's personal and business bank statements.
7. Processing fee check

Salaried customers:

1. Application form with photograph
2. Identity and Residence proof
3. Latest salary slip
4. Form16
5. Last 6 months bank's statement
6. Processing fee cheque.

List of Leading Banks providing Land Purchase Loan:

* Terms and conditions may vary from bank to bank.

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Disclaimer : This is an information based website, meant for providing assistance to it's readers. The information has been gathered from a number of secondary sources, we do not hold any responsibility for mis-information or mis-communication.