Housing Loans: Review of
Instructions
Date: Mar 05, 2015
RBI/2014-15/491
DBR.BP.BC.No.74/08.12.015/2014-15
DBR.BP.BC.No.74/08.12.015/2014-15
March 5, 2015
All
Scheduled Commercial Banks
(excluding RRBs)
(excluding RRBs)
Dear Sir,
Housing Loans: Review of Instructions
A. Inclusion of stamp duty and other charges in LTV ratio
Please refer to our circular
DBOD.No.BP.BC.78/08.12.001/2011-12 dated February 3, 2012 on ‘Housing Loans by
Commercial Banks – Loan to Value (LTV) Ratio’ whereby banks were advised that
they should not include stamp duty, registration and other documentation
charges in the cost of housing property so that the effectiveness of LTV ratio
is not diluted.
2. It has been brought to our notice that
these amounts form around 15% of the cost of the house and place a burden on
the borrowers from economically weaker sections (EWS) and low income groups
(LIG). With a view to encourage availability of affordable housing to such
borrowers, it has been decided that in cases where the cost of the
house/dwelling unit does not exceed Rs.10 lakh, banks may add stamp duty,
registration and other documentation charges to the cost of the house/dwelling
unit for the purpose of calculating LTV ratio.
B. Construction linked disbursal of housing loan
3. Please refer to our circular
DBOD.BP.BC.No.51/08.12.015/2013-14 dated September 3, 2013 on “Housing Sector: Innovative Housing Loan
Products – Upfront disbursal of housing loans”, in terms of which banks were
advised that disbursal of housing loans sanctioned to individuals should be
closely linked to the stages of construction of the housing project/houses and
upfront disbursal should not be made in cases of
incomplete/under-construction/green field housing projects.
4. In context of the above stipulation, some banks have
represented that they are not able to extend home loans to the allottees in the
project developed by Government Bodies/ Statutory Housing Authorities, as the
payment schedule prescribed by such authorities are not linked to the stages of
construction. Such authorities allot flats to the individual alottees with the
following payment modes:
·
One time lump-sum payment within 1 to 3 months after allotment.
·
Time linked payment plan not linked to the stages of
construction.
5. On a review, banks are advised that in cases of projects
sponsored by Government/Statutory Authorities, they may disburse the loans as
per the payment stages prescribed by such authorities, even where payments
sought from house buyers are not linked to the stages of construction, provided
such authorities have no past history of non-completion of projects.
Yours faithfully,
(Sudarshan
Sen)
Chief General Manager-in-Charge
Chief General Manager-in-Charge
