Options Regarding Home Finance for the NRIs
Jun 12, 2018 Home Loan
When an NRI decides to buy an immovable property in India, not only he has to come face to face with the regulations on the type of property that they can purchase but also the regulations on the mode of purchase.
We discuss them all here:
We discuss them all here:
1.Financing sources:
The funding and financing of the real estate property in India by NRIs can only be done through banking channels that are authorized to deal with foreign exchange. Traveller’s cheque or foreign currency is not permitted to buy the property in India. NRIs can use their credit, in their NRE (non resident external) account, NRO (non resident ordinary) account or FCNR (foreign currency non resident) account, to make the payment for the property.
NRIs are allowed to purchase the immovable property in India, by taking home loans from the banking institutes. The home loan can also be granted by the Indian employer for NRI employee.
NRIs are allowed to purchase the immovable property in India, by taking home loans from the banking institutes. The home loan can also be granted by the Indian employer for NRI employee.
2.Taking the home loan:
NRIs can obtain the home loan from the banks for buying a commercial or residential property. Apart from agricultural land or farmland, they can purchase anything in real estate. They can apply for the home loan either online or offline. The documents required will be depending on whether the applicant is self employed or is a salaried employee. The documents required either way is the copy of passport, residential address proof, photo identity, and proof of residence in the foreign country.
Depending on the nature of employment, the applicant is required to stay in the residing country for certain time period to avail the home loan.
Depending on the nature of employment, the applicant is required to stay in the residing country for certain time period to avail the home loan.
3.Home loan servicing:
The EMIs of the home loan can be paid through the remittance from outside the country via a proper banking channel or can be paid through the NRO, NRE or FCNR accounts. If the property is rented out, then the rent can be used to pay the home loan. if the relatives have transferred money to the applicant’s NRO or NRE account, then it can be used to service the home loan. In case the property has been acquired for self occupancy, then the NRI can avail home loan against the FCNR and NRE account deposit of up to 1 crore for servicing the home loan.
4.Remittance outside India:
NRIs are allowed to repatriate some funds in case the property is sold. However, the number of properties that one can remit or transfer to India is limited to two. The amount that can be repatriated cannot exceed the amount that has been transferred to India as remittance. For one financial year, the maximum amount that an NRI is allowed to remit is 1 million USD.
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