Karur Vysya Bank Home Loan

These KVB Home loans are extended towards resident Indians or HUF’S who wish to purchase a home of their own.

Key Features That Happy Home Loan Offers:

• Karur Vysya Bank offers this loan for construction of houses, or for the purchase of independent houses or even flats. However, the flats to be purchased cannot be older than 15 years.
• The loan can also be availed for purchase of plots and constructions, developed both by private constructors or developed by Government authorities.
• The loan can also be taken for takeovers of loans with other banking and financial institutions.
• The loan can also be availed towards renovation, extension, repairs or improvement to the existing houses owned by the individual.
• The bank offers Home loans up to a maximum amount of Rs.500 lakhs.
• The bank requires a margin of 25% for loans towards the purchase of new houses or flats.
• The bank requires a margin of 30% for loans towards the purchase of old houses or flats, the repayment period of which is up to 15 years.
• The bank requires a margin of 35% for loans towards the purchase of new houses or flats, the repayment period of which is above 15 years. However, based on the applicant's relationship with the bank and his/her credit worthiness, the bank allows some flexibility on the above-mentioned rates at the sole discretion of the sanctioning authority.
• The bank allows a holiday period of 12 months maximum.
• The bank allows repayment (including holiday period) tenure of 25 years. The repayment has to be done through regular EMI’S.
• The applicant has to submit an equitable mortgage of land & building as primary security at the time of applying for KVB Housing loan.
• Generally, a collateral security is not required in this case. However, it’s left to the discretion of the sanctioning authority. The collateral security has to be provided in the form of KVP’S, NSC’S, Bank deposits and land & buildings.
• A guarantor is required for availing home loans with the bank. The guarantor should be of sound credit worthiness in the eyes of the bank and should preferably be the applicant’s relative.
• This loan also provides for the borrower’s insurance coverage with SBI Life, LIC and BSLI amounting to an amount equivalent to the loan amount. However, taking the same is not compulsory. An applicant, if, interested can avail this facility by paying a single premium.
• The bank charges processing fee at the time of loan application, depending upon the amount of loan applied for. These charges are exclusive of service tax. Service taxes and other surcharges, as applicable will be levied above the below-mentioned charges.
• In case of loans, amounting up to 25 lakhs, a processing fee of Rs.7500+S.T will be charged

• For loans lying between 25 lakhs to 50 lakhs, a processing fee of Rs.15000+S.T will be charged
• For loans above Rs.50 lakhs, a processing fee of Rs.25000+S.T will be charged.

The applicant before they apply for a KVB home loan should keep the following points in mind:

• If the applicant is a salaried professional, he/she is required to submit a salary certificate for the last six months along with a certificate issued by the applicant’s employer.
• If the applicant is a self-employed professional, then he/she has to submit his latest ITR/Income statement certified by a CA professional.
• The net pay of the applicant after the deduction of the desired home loan should stand at a minimum of 40% of the applicant’s gross pay.
• An agriculturist with a proper IT return document or proof of income may also apply for this loan.
• An applicant can also apply for this loan for the purchase of land where construction has not yet begun. However, the applicant must make sure that the construction starts well within six months of the date of disbursement of the above said loan.
• If the borrower wishes to pay off the loan amount in full before the expiry of his/her loan period, he/se can do so without the burden of bearing prepayment charges.

KVB gruhapravesh loans are directed towards Non Resident Indians and persons of Indian origin (PIOs). This loan is specifically designed for Indians residing outside India who wish to own a house in India.

Key Features of KVB Gruhapravesh Loans:

• Only NRI’S or persons of Indian origin can apply for this loan.
• The applicant should be minimum 25 years of age.
• This loan can be availed for the construction of houses, or for the purchase of independent houses or even flats.

• The loan can also be availed for purchase of plots and constructions, developed both by private constructors or developed by Government authorities.
• The loan can also be taken for takeovers of loans with other banking and financial institutions.

• The loan can also be availed towards renovation, extension, repairs or improvement to the existing houses owned by the individual.
• The applicant, if an NRI should produce a valid Indian passport at the time of application, and if a person of Indian origin (PIO) must submit a valid foreign passport.
• The applicant should have a steady source of income before availing this loan.
• The applicant should have been employed abroad for at least a minimum period of 2 years.
• At the time of application, the applicant must provide a valid job contract or should have a valid job permit.
• The applicant should have a minimum net monthly income of US$ 750 or minimum net annual income of US$ 9000, or an amount equivalent to the same if the applicant earns in other foreign currencies.
• The bank extends a maximum loan amount of Rs.300 lakhs.
• The bank requires a margin of 20% for availing this loan.
• The bank allows loan tenure of maximum 25 years. The loan amount has to be paid off every month through regular Karur Vysya Bank home loan EMI. The loan should be liquidated by the time the applicant reaches 65 years of age, or achieves retirement, whichever is earlier.
• The bank allows a maximum holiday period of two months after the last disbursement. However, in the case of purchase of new houses, it allows a holiday period of 18 months from the date of first disbursement or two months after completion, whichever is earlier.
• The bank charges an interest rate of the Base rate at 10.75%+0.50% p.a. in case of home loans.
• The applicant has to submit an equitable mortgage by ways of title deeds as primary security when they apply for a KVB Limited Home loan
• The bank also demands certain additional security by ways of lien over credit balances in one’s deposit accounts, NSC’S, Life insurance policies. The bank if not totally satisfied by the above-mentioned documents for home loans, may also demand a third party guarantee as collateral security.
• A guarantor is required for availing Karur Vysya Bank home loan. The guarantor should be of sound credit worthiness in the eyes of the bank.
• The bank charges processing fee at the time of home loan application, depending upon the amount of the Karur Vysya Bank home loan applied for. These charges are exclusive of service tax. Service taxes and other surcharges, as applicable will be levied above the below-mentioned charges.

• In case of Karur Vysya Bank housing loans, amounting up to 25 lakhs, a processing fee equivalent to 0.25%+S.T of the loan amount will be charged
• For Karur Vysya Bank home loan lying between 25 lakhs to 75 lakhs, a processing fee of Rs.10000+S.T will be charged
• For Karur Vysya Bank home loan above Rs.75 lakhs, a processing fee of Rs.20000+S.T will be charged.

An applicant must remember that:

• Repayment of the Karur Vysya Bank home loan amount can be done by way of remittances from abroad through banks.
• Repayment can also be done through funds transfer NRE/FCNR/NRO accounts.
• The applicant’s Karur Vysya Bank home loan can be repaid by a close relative of the applicant.
• If the applicant decides to permanently settle in India, then he/she make the repayment through local banking channels.
• The interest on the Karur Vysya Bank home loan is charged on the basis of daily diminishing balance method.

• An applicant must have attained a minimum of 21 years in order to apply for Karur Vysya Bank home loans
• An applicant below the age of 60 years is eligible for the KVB Limited Home loan.
• A salaried individual or a self-employed professional who earns a regular income can take the KVB Limited Home loan. A non-salaried professional can also apply if the earnings are more than the minimum requirement.

However, an individual also has to option to increase his/her eligibility of obtaining the KVB Housing loans by following any of the below-mentioned steps:

• The applicant can add his/her spouse as a co-applicant for the loan. If done so, the spouse’s net income will also be taken into consideration while confirming the applicant’s income eligibility criteria.
• The longer the repayment period, the higher is the eligibility of the applicant for availing a loan with the bank.
• The applicant can also add their parents as co-applicants under the KVB Home loan

The net take home pay of the individual after deducting the House loan installment should be at least 40% of the applicant’s gross pay.

From the current financial year 2016-17 and with effect from 1^st of April 2016, the Karur Vysya Bank has started issuing Karur Vysya Bank home loan and all other types of loans at an interest rate which is linked to the MCLR of the bank. The relevant MCLR rates are given in the following table:

Type of MCLR	Rate of MCLR	Period of applicability
Overnight MCLR	8.30% per annum	1 day and above but less than 1 month
One month MCLR	8.30% per annum	1 month and above but less than  3 months
Three- month MCLR	8.65% per annum	3 months and above but less than 6 months
Six – Month MCLR	8.80% per annum	6 months and above but less than one year
One-year MCLR	9.00% per annum	1 year and above

Thus, the effective rate of interest on the housing loans from Karur Vysya Bank linked to the above-mentioned MCLR are listed below:

1. For Housing Loan scheme – 1 year MCLR + 0.85% per annum
2. For KVB Gruhapravesh (KVB NRI Home Loans) - 1 year MCLR + 0.85% per annum
3. For housing loans under the CRE norms - 1 year MCLR + 1.60% per annum

• The application form needs to be filled, signed and suffixed with a self-attested photograph
• A Copy of a valid Passport, Voter ID card or Driving License is required to be submitted as an Identity Proof
• For the valid address proof any of the mentioned document’s copy is required which are the Electricity or Telephone Bill / Ration Card / Rental Agreement / Passport.
• Either the bank statement for the past 3 months or the latest ITR or Form 16 is required for proof of income
• If the individual is salaried, the latest Salary Slip or current dated Salary Certificate along with the latest Form 16 should be submitted
• 2 passport size photographs in case of both salaried and non-salaried applicants.
• A cheque for the payment of the required processing fees.

• What are the types of KVB Home Loans available?

The Karur Vysya Bank offers two types of Home Loans. One is the Happy Home Loans which are offered to resident individuals and Hindu Undivided Families (HUFs) while the other one is the Gruhapravesh Home Loan which is designed specifically to meet the requirements of the NRIs.

• What is the loan amount granted under the home loan scheme?

Under the Happy Home Loan scheme, the applicant can avail a maximum of Rs.500 lakhs as a loan. For loans granted under the Gruhapravesh scheme, Rs.300 lakhs is the maximum quantum of home loan available.

• What is the loan repayment tenure under the bank’s home loan scheme?

The bank keeps fixed loan tenure of 25 years for both the loan schemes of Happy Home Loans and Gruhapravesh Home Loan scheme

• Are there any charges payable for availing the home loans from the bank?

Yes, a loan processing fee is payable for availing the loan among other applicable charges. The loan processing fee payable for Happy Home Loans ranges from Rs.7500 to Rs.25, 000 exclusive of service tax. The amount of processing fee payable depends on the amount of loan availed. For Gruhapravesh home loans, the processing fee is Rs.10, 000 or Rs.20, 000 depending on the amount of home loan availed.

• Are there any margin requirements for the loan?

The bank does not grant the full value of the property as a loan. A margin is maintained when a loan is sanctioned. The margin retained in case of a Home Loan for resident Indians ranges from 25% to 35% depending on the type of the property which is intended to be funded from the loan. For the NRI Home loans, a flat rate of 20% of the home loans sanctioned is retained as a margin.

• What rate of interest is charged on the home loans?

From the current financial year, the bank issues the home loans linked to its MCLR. The MCLR is ascertained and then the home loan rate is linked to this rate. Currently, for Happy Home Loans, the rate of interest charged is one-year MCLR + 0.85% per annum. The one-year MCLR being 10.05%, the applicable rate of interest becomes 10.90% per annum. For the NRI Home Loan scheme, the rate of interest charged is similar to the normal home loan which is 10.90% per annum. However, loans offered by Karur Vysya Bank under the CRE norms have a higher rate of interest. The applicable rate of interest charged is One-year MCLR + 1.60% per annum. This becomes equivalent to 10.05% + 1.60% = 11.65% per annum.

• What are the purposes for which the loan can be used?

Being a home loan, the loans, both for resident Indians and Hindu Undivided families (HUFs) and for NRIs, can be used for any requirement related to housing. The purposes include:

• For construction of a house or a flat
• For buying a new house or a flat which is already constructed
• For buying a house or flat which is not older than 15 years
• For buying a plot of land meant for construction of a house
• For carrying out repairs, renovations, improvements or extensions to an existing house
• For taking over existing home loans which are with other banks or financial institutions
• Is any repayment holiday provided under the home loan available at Karur Vysya Bank?

Yes, the Karur Vysya Bank provides a home loan repayment holiday under the loan scheme. This repayment holiday is also called the moratorium period and it depicts the gap after the loan disbursement and before the commencement of the loan repayment. The applicant is not required to pay any installments during the repayment holiday and the holiday tenure is different for both the loan schemes offered by the bank. For the Happy Home Loan schemes, the moratorium period allowed by the bank is a maximum of 12 months. For the NRI home loan scheme, the moratorium period allowed is only 2 months after the last disbursement of the loan tranche is made. However, if a new house is purchased by the individual, the bank allows a moratorium period of 18 months from the date the first loan tranche is disbursed or 2 months after the last loan tranche is disbursed whichever is earlier.

• PaisaBazaar offers EMI calculator for the convenience of its applicant. The EMI calculator is a simple and handy tool that makes the financial planning of the applicant really easy. One may know how much saddle the upcoming loan EMI is going to put on their monthly budget.
• Any Interested applicant may login to www.paisabazaar.com. The applicant may select the EMI calculator and fill up the requisite details accordingly. Post-filling up the details such as Loan Amount, Rate of Interest and Tenure, the results would be prompt and the applicant may know the forthcoming EMI amount in case he/she applies for the personal Loan.

Applying for a Home Loan

The loan application process has been simplified by facilitating it through the online channels. The Paisabazaar.com website is available for making the application of a credit card. The process is simple and fast and cuts down on inconveniences.