The NRI’s are considered as one of the major prospective buyers of properties in India. The home loans can be taken from any of the banks in India as per the choice of the borrowers. The loans disbursement can be done in installments in case of the new construction ones while as for the resale properties immediate disbursement can be done. The NRI’s from many countries like Middle East countries, Europe, Australia continent, USA is one of the major destinations from which most of the Indians tend to invest in Indian real estate markets and also avail loans from the banks which are present in India. An investor who avails the loans in India and also the one who has a taxable income in spite of being an NRI can avail of the tax benefit by taking the loans. The home loans interest rates can be availed at similar interest rates which are charged to the citizens of India. Also, the processing fees are similar to that of the ones being charged to Indian citizens. The documentation required for the NRI’s is different from that of the Indian citizens. The approval process is also more stringent for NRI’s as the banks are cautious while extending the loans to the NRI as the outside country people may sometimes easily cheat the banks in India.

The loans are charged at interest rates of 6.50%-9% per annum. India receives a huge amount of remittances from the outside country as many people in search of job opportunities migrate to different countries for work as the wages paid to the people abroad are higher as compared to India. So many people amongst the NRI’s buy properties in India from the funds earned abroad and thus the NRI buyers are amongst the major buyers for the real estate in India. The most common markets for investments in India are Delhi, Kolkata, Mumbai, Kochi, and Bangalore & Chennai. The state of Kerala receives the highest amount of money from the Middle East, Europe & USA. Thus the purchase of properties in Kerala is most commonly being done by the NRI public as around 35 lakh Keralites are staying abroad and also in many other countries. Thus the real estate market in Kerala is highly dependent on the NRI’s investing in the state of Kerala. The applicants with proper documentation process & proper income proof are the ones who can get loans easily. Also, the individual should not have any criminal records in India or abroad before the approval of loans.

Myths about home loans

• Loans can be availed by only Indian citizens:

It is not mandatory that the loans can be taken by only Indian citizens or the ones who are working in India. Banks can extend the loans to even international workers who have a proper source of income and adequate income can buy properties in India by availing loans from the banks. Banks charge interest rates similar to that of the interest rates charged to Indian citizens. Thus banks can easily approve the loans to the NRI’s for the purchase of property in India.

• Loans are charged higher interest rates for NRI:

The interest rates being charged are similar to those charged for the Indian citizens. The loans can be availed for a longer duration of 30 years. And the processing fees charged are also similar to that of the charges taken for the domestic borrowers. Thus the NRI borrowers do not need to pay any extra money for the loans processing or interest rates.

• No tax benefits can be taken by an NRI in India:

If an NRI is having a source of income in India despite residing abroad then in that case the borrower has to file for income tax. Thus in that case, if the loans are being taken then in that case the borrower can avail tax benefits on the home loans being taken.

We can conclude that the loans can be taken by NRI very easily and also the interest rates are similar to that of the interest charged to Indian citizens. The loans installments can also be paid by the NRI by staying abroad. Thus the NRI’s are encouraged to invest in India as they can easily avail loans at lower interest rates and also avail tax benefits on the home loans.