Housing Loan | Jammu and Kashmir J&K Bank, Full Procedure
PURPOSE
Loans under the bank’s housing finance scheme can be granted to individuals/ corporates for:-
- Purchase of plot of land for construction of residential house thereupon, provided a declaration is obtained from the borrower that he/she will start constructing a house on the said plot, with the help of bank finance or otherwise, within a period of 2 years failing which interest rate applicable to Commercial Real Estate shall be charged wef account open date.
- Construction of House/Flat/ Dwelling unit
- Outright Purchase of an existing house/ flat/dwelling unit (fully built/ under construction)
- Supplementary finance for repairs/ renovations/ additions/ alterations/ completion of an existing house/ flat/ dwelling unit, constructed/purchased from own sources or with the help of bank finance, whether liquidated or outstanding.
Note: – For purchase/ addition/ alteration/repair/ renovation/ completion of an existing dwelling unit, it shall be ensured that the residual life of the property, as certified by the approved valuer, is more than the door to door tenor of the loan. - Housing loan can be sanctioned for construction/ purchase of 2nd dwelling unit per family or purchase of land/plot irrespective of whether the 1st dwelling unit has been constructed/ purchased from own sources or bank finance.
ELIGIBILITY
- Individuals having stable source of income, owning or proposing to own house property singly or jointly, belonging to any of the following categories:
- Permanent Employees of State /UT/ Central Government, Government / Semi-Government Undertakings, Autonomous Bodies and Govt Institutions.
- Employees of Pvt/Public Ltd Companies with a minimum of 3 years of cumulative service and minimum 1 year service with current employer.
- Professionals, Self Employed Individuals / Businessmen with a minimum 2 years standing in the current profession/ Business.
- Persons engaged in agricultural and allied activities.
- Pensioners State /UT/ Central Government, Government / Semi-Government Undertakings, Autonomous Bodies and Govt Institutions
- Contractual employees of State /UT/ Central Government, Government / Semi-Government Undertakings, Autonomous Bodies and Govt Institutions shall also be eligible, subject to below noted conditions:
- The remaining period of contract is equal or more than proposed tenor of loan (not mandatory for contractual employees working with current employer for more than 03 years uninterruptedly).
- Mortgage of underlying property shall be mandatory in case of loans to contractual employees.
- Branch Heads shall have no powers to sanction cases where occupation of one or more borrowers/ co-borrowers is of contractual nature.
- Non-Resident Indians working with reputed companies in countries falling in following risk categories as per classification provided by ECGC shall also be eligible for financing under the scheme.
- Insignificant Risk.
- Low Risk.
- Moderately Low Risk
Recommending/ sanctioning authorities to satisfy themselves about the income earned by the Non-Resident and take necessary safeguards for extending finance and regular repayment of such loans (For further details, refer annexure (2) to this document)
- Banks own staff shall also be eligible under public category, provided NOC for same is obtained from HR.
- Corporate Entities shall also be eligible(For further details, refer annexure 3 to this document)
Note:
- Where ever the property owner(in case of pre-owned or ancestral properties) is/are not having independent source of income, the income earning near relative (s)/ legal heir(s) like son(s)/ daughter(s)/ spouse/siblings living with the property owner(s) may join as Joint-Borrowers/ Co-Borrower(s) for the loan and his/her/their income can be considered for arriving at loan eligibility. In such cases, the age of property owner(s) shall not be considered for deriving loan eligibility or fixing tenor of loan.
The housing loan borrowers shall be eligible for Top Up Loans as well.
AGE
Minimum age at the time of loan application: 18 years
QUANTUM OF FINANCE
- For Construction/Purchase of House/Flat/Dwelling unit: Cost of project less by stipulated margin subject to repaying capacity of borrowers(s)
- For purchase of Land/ Plot for construction of House/ Building: The maximum quantum of finance shall be the minimum of the following:
- 75% of cost of plot/ land
- 75% of total Housing Loan eligibility
- Rs.75.00 lacs
However, Zonal Credit Committee may consider loans upto a maximum of Rs.100 lacs for purchase of plot/land. Similarly Divisional Credit Committee/ Central Credit Committee may consider loans to the extent of Rs 500.00 lacs for purchase of land/plot for construction of residential house there upon.
- For Addition/Alteration/Completion of house: Estimated cost of addition/alteration/completion of dwelling unit less by stipulated margin subject to condition that, where ever applicable, necessary permission has been obtained from the competent authority.
- For repairs / renovation/: Estimated cost of repair/renovation of dwelling unit less by stipulated margin.
Note: Loans for repair/ renovation of a single residential property can be availed multiple times.
MARGIN
- Minimum Margin for Construction / purchase/ repair/ renovation/addition/alteration of house/flat shall be:
| Loan up to 30 Lakh | 10% |
| Loan above Rs. 30 Lakh to Rs. 75 Lakh | 20% |
| Loan above Rs. 75 Lakh | 25% |
| In case of loans for purchase of land | 25% |
REPAYMENT
Principle along with interest shall be repaid in Equated Monthly Instalments (EMIs) after moratorium which shall be re-fixed with every increase/decrease in interest rate during the tenor of loan. The repayment period and EMIs calculated for repayment shall be decided on the merits of each case on a realistic basis after taking into account the repaying capacity of the borrower.
In order to ensure that regular instalments are received and defaults are minimized, it is to be ensured as under:
- In case of borrowers maintaining operative account with our bank – A debit authority for debit of monthly instalment to be obtained and necessary standing Instructions (SIM) to be created in the system in this regard.
- In case of borrowers not maintaining operative account with our bank, recovery/ Repayment of EMIs in Housing Loan accounts be considered through NACH/RECS (Debit) or any other feasible repayment/ recovery mechanism.
(However, at least three post-dated cheques be obtained for collection of first three instalments, as registration of NACH mandate with the drawee bank usually takes a month or two. Once the NACH gets executed, the pending cheques (if any) may be subsequently returned to the borrower. Besides, as a due diligence process, for borrowers maintaining operative accounts with other banks, the processing fee/CIBIL Fee should be obtained in the form a crossed cheque upfront and the said cheque be got realised immediately, which will serve the dual purpose of borrowers signature verification with the other bank and KYC verification as well).
MARGIN
- Minimum Margin for Construction / purchase/ repair/ renovation/addition/alteration of house/flat shall be:
| Loan up to 30 Lakh | 10% |
| Loan above Rs. 30 Lakh to Rs. 75 Lakh | 20% |
| Loan above Rs. 75 Lakh | 25% |
| In case of loans for purchase of land | 25% |
MORATORIUM PERIOD
REPAYMENT
Principle along with interest shall be repaid in Equated Monthly Instalments (EMIs) after moratorium which shall be re-fixed with every increase/decrease in interest rate during the tenor of loan. The repayment period and EMIs calculated for repayment shall be decided on the merits of each case on a realistic basis after taking into account the repaying capacity of the borrower.
In order to ensure that regular instalments are received and defaults are minimized, it is to be ensured as under:
- In case of borrowers maintaining operative account with our bank – A debit authority for debit of monthly instalment to be obtained and necessary standing Instructions (SIM) to be created in the system in this regard.
- In case of borrowers not maintaining operative account with our bank, recovery/ Repayment of EMIs in Housing Loan accounts be considered through NACH/RECS (Debit) or any other feasible repayment/ recovery mechanism.
(However, at least three post-dated cheques be obtained for collection of first three instalments, as registration of NACH mandate with the drawee bank usually takes a month or two. Once the NACH gets executed, the pending cheques (if any) may be subsequently returned to the borrower. Besides, as a due diligence process, for borrowers maintaining operative accounts with other banks, the processing fee/CIBIL Fee should be obtained in the form a crossed cheque upfront and the said cheque be got realised immediately, which will serve the dual purpose of borrowers signature verification with the other bank and KYC verification as well)
JKBOSE Important Exam Notification class 10th, 12th Private Bi-annual 2023
RATE OF INTEREST
| Quantum of Finance | Credit / CIBIL Score | LTV | Interest rate | ||
| SALARIED | NON-SALARIED | ||||
| *JKB Preferred | Other Salaried | ||||
| Upto Rs 30.00 Lacs | Above 800 | < 80% | HLRLLR-35 BPS(Currently 8.75%) | HLRLLR-35 BPS(Currently 8.75%) | HLRLLR- 25 BPS(Currently 8.85%) |
| >80% and <90% | HLRLLR-15 BPS(Currently 8.95%) | HLRLLR-15 BPS(Currently 8.95%) | HLRLLR-05 BPS(Currently 9.05%) | ||
| 751-800 | < 80% | HLRLLR-15 BPS(Currently 8.95%) | HLRLLR-15 BPS(Currently 8.95%) | HLRLLR-05 BPS(Currently 9.05%) | |
| >80% and <90% | HLRLLR(Currently 9.10%) | HLRLLR+05 BPS(Currently 9.15%) | HLRLLR+15 BPS(Currently 9.25%) | ||
| 701-750 | < 80% | HLRLLR(Currently 9.10%) | HLRLLR+05 BPS(Currently 9.15%) | HLRLLR+15 BPS(Currently 9.25%) | |
| >80% and <90% | HLRLLR(Currently 9.10%) | HLRLLR+25 BPS(Currently 9.35%) | HLRLLR+35 BPS(Currently 9.45%) | ||
| 700 or below | < 80% | HLRLLR(Currently 9.10%) | HLRLLR+25 BPS(Currently 9.35%) | HLRLLR+55 BPS(Currently 9.65%) | |
| >80% and <90% | HLRLLR+20 BPS(Currently 9.30%) | HLRLLR+45 BPS(Currently 9.55%) | HLRLLR+75 BPS(Currently 9.85%) | ||
| Above Rs 30.00 lacs and upto Rs 75.00 lacs | Above 800 | < 70% | HLRLLR-35 BPS(Currently 8.75%) | HLRLLR-35 BPS(Currently 8.75%) | HLRLLR- 25 BPS(Currently 8.85%) |
| >70% and <80% | HLRLLR-15 BPS(Currently 8.95%) | HLRLLR-15 BPS(Currently 8.95%) | HLRLLR-05 BPS(Currently 9.05%) | ||
| 751-800 | < 70% | HLRLLR-15 BPS(Currently 8.95%) | HLRLLR-15 BPS(Currently 8.95%) | HLRLLR-05 BPS(Currently 9.05%) | |
| >70% and <80% | HLRLLR(Currently 9.10%) | HLRLLR+05 BPS(Currently 9.15%) | HLRLLR+15 BPS(Currently 9.25%) | ||
| 701-750 | < 70% | HLRLLR(Currently 9.10%) | HLRLLR+05 BPS(Currently 9.15%) | HLRLLR+15 BPS(Currently 9.25%) | |
| >70% and <80% | HLRLLR(Currently 9.10%) | HLRLLR+25 BPS(Currently 9.35%) | HLRLLR+35 BPS(Currently 9.45%) | ||
| 700 or below | < 70% | HLRLLR(Currently 9.10%) | HLRLLR+25 BPS(Currently 9.35%) | HLRLLR+55 BPS(Currently 9.65%) | |
| >70% and <80% | HLRLLR+20 BPS(Currently 9.30%) | HLRLLR+45 BPS(Currently 9.55%) | HLRLLR+75 BPS(Currently 9.85%) | ||
| Above Rs 75.00 lacs | Above 800 | < 65% | HLRLLR-35 BPS(Currently 8.75%) | HLRLLR-35 BPS(Currently 8.75%) | HLRLLR- 25 BPS(Currently 8.85%) |
| >65% and< 75% | HLRLLR-15 BPS(Currently 8.95%) | HLRLLR-15 BPS(Currently 8.95%) | HLRLLR-05 BPS(Currently 9.05%) | ||
| 751-800 | < 65% | HLRLLR-15 BPS(Currently 8.95%) | HLRLLR-15 BPS(Currently 8.95%) | HLRLLR-05 BPS(Currently 9.05%) | |
| >65% and< 75% | HLRLLR(Currently 9.10%) | HLRLLR+05 BPS(Currently 9.15%) | HLRLLR+15 BPS(Currently 9.25%) | ||
| 701-750 | < 65% | HLRLLR(Currently 9.10%) | HLRLLR+05 BPS(Currently 9.15%) | HLRLLR+15 BPS(Currently 9.25%) | |
| >65% and< 75% | HLRLLR(Currently 9.10%) | HLRLLR+25 BPS(Currently 9.35%) | HLRLLR+35 BPS(Currently 9.45%) | ||
| 700 or below | < 65% | HLRLLR(Currently 9.10%) | HLRLLR+25 BPS(Currently 9.35%) | HLRLLR+55 BPS(Currently 9.65%) | |
| >65% and< 75% | HLRLLR+20 BPS(Currently 9.30%) | HLRLLR+45 BPS(Currently 9.55%) | HLRLLR+75 BPS(Currently 9.85%) | ||
Note:
i). JKB Preferred Segment includes employees of J&K Govt, Administration of UT of Ladakh, J&K Police, SMVDSB, IIM Jammu, Kashmir University, Jammu University, NIT Srinagar, Central University Jammu, JMC Jammu, SKUAST (K) and various other Govt Departments/ Institutions with whom J&K Bank has entered into MoUs.
ii). On account of revised pricing structure for housing loans, the relevant paras of the Policy on Pricing of Credit Products of the bank stand updated to this extant.
iii). The above tabulated interest rates shall be applicable only to fresh housing loans, sanctioned w.e.f April 17, 2023 , irrespective of purpose, i.e purchase/ construction/ repair/ renovation/ addition/ alteration etc.
iv). For the purpose of uniformity, all CIR’s (Credit Information Reports) for housing loan borrowers shall be extracted from CIBIL only. The scheme/ CIR Policy of the bank shall deemed to be modified to this extent.
v). CIBIL Score at the time of sanction of loan shall be reckoned for arriving at pricing of the loan and any upward/ downward trend in CIBIL score after sanction of loan shall have no impact on the pricing.
vi). Salaried class shall include employees of State/ Central/ UT Govt/ Govt Undertakings/ Autonomous Bodies/ Institutions employees of reputed corporate houses, pensioner’s etc maintaining salary/ pension account with our bank.
vii). In case of jointly availed housing loans, credit score of that borrower/ Co-borrower shall be considered whose contribution to EMI is highest.
viii) In case of borrowers with insufficient Credit History/no credit history (having Credit score of -1, 0, 1, or 2), the interest rate, as applicable to borrowers with CIBIL score of 700 or below shall be charged.
PROCESSING CHARGES
- Upfront Fee/ Processing charges: 0.25% of Loan amount + applicable GST
Minimum Rs 2000+ GST Maximum Rs 50000+ GST - INSPECTION CHARGES: Actual transportation charges or Rs. 500/- + applicable GST (whichever higher). The amount shall be credited to account XXXXXXXXXXXXXXXX.
PREPAYMENT PENALTY
- NIL
SECURITY
In case of purchase of land/Plot/ready built house/ construction of house on pre-owned land/ plot/ Repairs/Additions/Alterations/Extension of existing houses:
Primary:
- Equitable/Registered Mortgage of land/house property/flat to be constructed/purchased. The title of the property must be clear marketable and free from encumbrance (not applicable to properties already charged against existing facilities)
- Where mortgage of house /flat cannot be created immediately and /or possession of house/flat is not given, e.g in situations like house/flat or under construction house/ flat or to be constructed house/flat is being purchased/ from the Housing Board/ Co-operative Society / Development Authority/ Construction Company/ Builder and title/conveyance deed is executed in favour of purchaser only after completion of full or partial construction after purchaser making full payment of the cost of house/flat, a tripartite agreement shall be executed amongst the 1) Housing Board/ Development authority / Co-operative Society/ Construction Company/ Builder, 2) The Borrower and 3)The Bank where in the Housing Board/ Development Authority / Co-operative Society/ Construction Company/ Builder under takes that the title to house/ flat shall be transferred to the Borrower immediately on receipt of entire sale consideration and the Bank’s lien shall also be marked in their/ his records, thereafter to be followed by execution of mortgage deed in favour of the Bank once the project has been completed and Sale Deed (Deed of apartment/Conveyance Deed in case of Flats) has been executed. Charge to be registered in favour of the Bank with the concerned authorities. Besides tripartite agreement, an affidavit cum undertaking from the Housing Board/ Development Authority /Co-operative Society/ Construction Company/Builder to the effect that the construction shall be as per the sanctioned plan & building byelaws, to be obtained.
Note: Wherever a builder is not ready to sign Tripartite Agreement or the operative levels are not able to obtain TPA for whatsoever reasons, the concerned Zonal Heads/ Zonal Credit Committees will have powers to dispense with this requirement on case to case basis, depending on the merits of individual case.
In such cases where the TPA is not obtained from builders of under construction housing projects, the concerned sanctioning authority shall comply to below noted stipulations:
- Obtain an undertaking from the borrower(s) that in case of cancellation of his her allotment or non- conclusion of sale transaction with the builder, he/she/they will route the refund amount from builder towards adjustment of outstanding in loan account availed for purchase of said flat.
- At the time of disbursement of such housing loans, intimate the builder that the prospective buyer has availed finance from bank/branch for purchase of said flat. Besides the builder(s) shall be requested to remit the refund amount to bank in case of cancellation of allotment of the buyer or non-conclusion of the sale transaction.
Collateral Security:
No collateral security /3rd party guarantee is required under the scheme except following categories of borrowers:
- Pensioners- guarantee of spouse / Legal Heir(s),who is / are entitled for family pension along with additional guarantee of one individual
- NRIs- 3rd party guarantee of two resident Indians of sufficient means to withstand the liabilityNote: The mortgage of the existing house property shall not be insisted for loans up to Rs.05.00Lakh (Rs.10.00 Lakh in case of Permanent Employees of State /UT/ Central Government, Government / Semi-Government Undertakings, Autonomous Bodies and Govt Institutions granted for the purpose of repairs/additions/ alterations /extension of existing houses. These loan cases shall be secured by third party guarantee of two persons or Assignment of Life Insurance Policies, Gov’t Securities, IVP’s, NSC’s KVP’s or FDRs of own bank etc. However, negative lien over the existing house property for which the facility is granted shall be obtained along with an irrevocable power of attorney executed by the borrower authorizing the Bank to sell the house in case of default
