NRI Home Loan

Many banks and housing finance companies (HFCs) offer NRI Home Loans, a tailor-made home loan product for Non-Resident Indians (NRIs), Persons of Indian Origin (PIOs) or Overseas Citizens of India (OCIs) who wish to purchase residential property, construct a home on a plot of land or repair/renovate their existing property in India. Loan applicants can avail this facility either through the regular home loan product provided by several lenders or as an independent offering within the broader category of home loans.

Features of NRI Home Loans

Interest Rates

Most lenders offer NRI Home Loans at interest rates similar to their regular Home Loan products. The interest rates for loan applicants availing NRI Home Loans are based on factors like their monthly income, loan amount, credit score, occupation and employer’s profile.

Name of Lender	Up to Rs. 30 Lakh	Above Rs. 30 Lakh to Rs. 75 Lakh	Above Rs. 75 Lakh
SBI	8.50%-9.85% p.a.	8.50%-9.85% p.a.	8.50%-9.85% p.a.	Check Eligibility
HDFC Bank Limited	8.75% p.a. onwards	8.75% p.a. onwards	8.75% p.a. onwards	Check Eligibility
LIC Housing Finance	8.50% - 11.25% p.a.	8.50% - 10.55% p.a.	8.50% - 10.75% p.a.	Check Eligibility
ICICI Bank	8.75% p.a. onwards	8.75% p.a. onwards	8.75% p.a. onwards	Check Eligibility
Kotak Mahindra Bank	8.75% p.a. onwards	8.75% p.a. onwards	8.75% p.a. onwards	Check Eligibility
PNB Housing Finance	8.50% - 14.50% p.a.	8.50% - 14.50% p.a.	8.50%-11.45% p.a.	Check Eligibility
Punjab National Bank	8.45% - 10.25% p.a.	8.40% - 10.15% p.a.	8.40% - 10.15% p.a.	Check Eligibility
Bank of Baroda	8.40% - 10.65% p.a.	8.40% - 10.65% p.a.	8.40% - 10.90% p.a.	Check Eligibility
IDFC First Bank	8.85% p.a. onwards	8.85% p.a. onwards	8.85% p.a. onwards	Check Eligibility
L&T Finance Limited	8.65% p.a. onwards	8.65% p.a. onwards	8.65% p.a. onwards	Check Eligibility
Tata Capital Housing Finance	8.75% p.a. onwards	8.75% p.a. onwards	8.75% p.a. onwards	Check Eligibility
Federal Bank	8.80% p.a. onwards	8.80% p.a. onwards	8.80% p.a. onwards	Check Eligibility
Axis Bank	8.75%-13.30% p.a.	8.75%-13.30% p.a.	8.75%-9.65% p.a.	Check Eligibility
Godrej Housing Finance	8.55% p.a. onwards	8.55% p.a. onwards	8.55% p.a. onwards	Check Eligibility

Note: Interest rates as on 12th April 2024

Loan-to-Value Ratio

The LTV ratio of NRI Home Loans is the total proportion of a property’s value that banks or HFCs can finance through the loan. It cannot exceed the regulatory cap on Home Loan LTV ratios fixed by the RBI. The breakup of loan amount for an NRI Home Loan and the corresponding LTV ratio are as follows:

Loan Amount	LTV Ratio
Up to Rs. 30 lakhs	Up to 90% of the property’s value
Above Rs. 30 lakhs to Rs. 75 lakhs	Up to 80% of the property’s value
Above Rs. 75 lakhs	Up to 75% of the property’s value

Lenders undertake a credit risk assessment to determine the final LTV ratio for an NRI Home Loan applicant. Some of the factors considered during the credit risk assessment process include the applicant’s credit profile, repayment capacity, market value of the property, etc.

Loan Tenure

Banks and HFCs usually offer NRI Home Loans for tenures of up to 30 years. Lenders consider the loan applicant’s repayment capacity while finalising the tenure for the NRI Home Loan. Lenders usually require the home loan applicants to restrict their total EMI contribution, including that of their proposed NRI Home Loan, to be within 50-60% of their net monthly income.

Home Loan Balance Transfer Facility for NRIs

NRIs having existing home loans can use the Balance Transfer option to transfer their outstanding loan to other lenders at lower interest rates and thereby, their overall interest cost. Borrowers must note that the new lender will perform a comprehensive credit risk assessment before ratifying their request for balance transfer.

Processing Fees and Prepayment Charges

Most lenders levy processing fees from new and existing borrowers for availing NRI Home Loans. The processing fees for NRI Home loan usually range between 0.25% and 2.00% of the total loan amount. RBI has provided specific guidelines to prevent lenders from demanding prepayment fees on a floating rate NRI Home Loan. However, they are free to decide the quantum of prepayment fees on fixed-rate NRI Home Loans.

Eligibility Criteria for availing NRI Home Loans

• Non-Resident Indians (NRIs), Persons of Indian Origin (PIOs) and Overseas Citizens of India (OCIs) are eligible to apply for NRI Home Loans.
• Age: Lenders generally provide NRI Home Loans to fresh loan applicants and existing borrowers (in case of balance transfer) aged 18 years and older. However, they usually require NRI Home Loan borrowers to repay their loans by the time they are 70 years old.
• Both salaried and self-employed individuals/business owners can apply for NRI Home Loans.
• Credit Score: Loan applicants having a credit score of 750 and above stand a higher chance of availing a NRI Home Loan. Many lenders also provide NRI Home Loans at lower interest rates to applicants with higher credit scores.

Individual lenders might also consider other factors like an applicant’s income, country of residence, educational qualification, liabilities, assets owned, work experience (for salaried) and business continuity (for business owners), etc. while ascertaining the eligibility of a NRI Home Loan applicant. The income eligibility for a home loan applicant may vary based on their occupation profile and country of residence.

Documents Required to Apply for NRI Home Loans

Loan applicants are generally required to submit the following documents along with duly filled loan application form to avail an NRI home loan:

KYC Documents

• Copy of valid passport and visa
• Copy of valid address proof
• PAN Card or Form 60 (If customer does not have a PAN card)
• Passport size photographs of applicant/co-applicant(s)
• Any of the following identity documents:
  • Driving License
  • Voter ID Card
  • Job card issued by NREGA duly signed by a state government officer
  • Documents issued by Govt. Departments of Foreign Jurisdiction (Social Security Card, Work/Resident Permit, Green Card etc.)
  • Letter issued by the Foreign Embassy/Mission in India
• PIO/OCI Card issued by Government of India
• Stamped and notarized declaration with Ration Card/Passport of parents/grand-parents/spouse of PIO to establish their Indian citizenship

Proof of Income

• Bank statements including NRE/NRO accounts for last 6 months
• Credit Bureau Report
• Details of the ongoing loans of the business entity and the individual along with photocopy of the sanction letter
• Photocopy of the employment contract, appointment letter or offer letter
• Embassy attested Salary Certificate/Slip (for salaried NRI applicants)
• Balance Sheet/Profit & Loss Account of past years (for non-salaried NRI applicants)

Other documents

• Copy of the Allotment Letter/Buyer Agreement
• Title Deed & Prior Deeds
• Encumbrance Certificate
• Land Tax Receipt (Latest)
• Possession Certificate
• Approved Building Plan
• Property Sketch
• Any other documents as required by the bank

Note: The documents listed are indicative and may vary from one lender to another. Your prospective home loan provider may ask for more documents at the time of loan application.