If you are an NRI and wish to invest in residential or commercial property in
PCMC and Pune, refer to the following FAQs.
Generally, an Indian Citizen who stays abroad for employment/carrying on business or vocation outside India or stays abroad under circumstances indicating an intention for an uncertain duration of stay abroad or a person who is not resident in India for a period over 182 days is a non-resident Indian. Persons posted in U.N. organizations and officials deputed abroad by Central/State Governments and Public Sector undertakings on temporary assignments are also treated as non-residents.
Generally, under the provisions of Foreign Exchange Management Act a person of Indian Origin is an individual (other than a citizen of Pakistan, Bangladesh, Sri Lanka, Afghanistan, China, Iran, Nepal, Bhutan) who at any time held an Indian passport, or he or his father or his grandfather was a citizen of India by virtue of the Constitution of India or Citizenship Act, 1955 (57 of 1955). Non-resident foreign citizens of Indian Origin are treated on par with non-resident Indian citizens for the purpose of certain facilities.
NRIs and POIs do not require permission from RBI to acquire residential / commercial premises in India (other than agricultural land/farm house/plantation property). A person resident outside India acquiring property to carry on business from India has to file with the Reserve Bank a declaration in Form IPI within ninety days from the date of acquisition of immovable property. A citizen of Pakistan, Bangladesh, Sri Lanka, Afghanistan, China, Iran, Nepal or Bhutan cannot acquire immovable property without prior permission of Reserve Bank. However, he can take on lease an immovable property for not more than 5 years treated on par with non-resident Indian citizens for the purpose of certain facilities.
Housing loan will be sanctioned depending upon your repayment capacity and according to your income. Your spouse's income can be included, if you want to increase the amount of your loan. The maximum loan that can be sanctioned varies with housing finance companies and ranges from Rs.10 lakh to Rs.1 crore.
Reducing balance is the method of reducing the principal amount already paid, from the outstanding loan amount. Every time you make a payment, you pay interest on that part of the original principal sum that has remained un-repaid till then.
Tax benefits are available on both the principal and interest components of the loan as per the income tax act. The upper limit of the amount of deduction of interest repayment allowed from your gross total income is now Rs. 75,000 p.a. Besides, Sec. 88 offers you tax benefits for principal repayments. The principal repayment amount included in the overall limit of Rs 60,000 offered by this section is Rs 10,000.
The best way is to compare the EMIs and the tenures of the two home loans. The loan carrying the lower EMI for the same tenure is the cheaper option.
A fixed rate home loan is a loan where the interest rate is constant over the entire tenure of the loan tenure.
Floating interest rate loan is a loan where the interest rate payable is linked to the market rate like the bank-lending rate. As the bank rate varies, the interest rate payable by you will also rise and fall. Hence you will have to bear the risk of interest rate fluctuations; the floating interest rates offered are slightly lower than the fixed interest rates.
A home extension loan is a loan, which helps you to meet the expenses of any alteration like extension/expansion or modification of your home. You can avail of a home extension loan, after obtaining the requisite approvals from the municipal corporation.
A home improvement loan is one that is made available for you to do certain external work like structural repairs, waterproofing or internal work like tiling and flooring, plumbing, electrical work, painting, etc.
There is restriction on transfer of immovable property under Section 269UC of the Income Tax Act.
Under Section 88 of the income tax you can claim benefit for the principle repayment, interest on loan is deductible u/s 24 from income from House Property.