How are NRI Home Loans and Resident Home Loans Different?

Arwind Sharma By Arwind Sharma, 5th Jul 2017 | Follow this author | RSS Feed | Short URL http://nut.bz/3m42xuxm/
Posted in Wikinut>Business>Accounting & Finance

Here is a detailed description of NRI Home Loans differ from resident Home Loans.

Difference between NRI and Residence Home Loans

NRIs or Non-Reliable Indians are people who have been staying and working abroad for some time now. NRIs earn in foreign currency which can have a lot of benefits for the NRIs as well as Indian Government, which is always short of foreign reserve. This makes NRIs good potential investors in India. The Indian government also offers a lot of good offers to the NRIs like pre-approved loans, etc.

Banks and Financial services offer pre-approved loan to such NRI accounts, especially for NRIs from UK, USA, and other European countries, whose currency rate is higher. The banks offer a speedy service of around 24 hours, in issuing the loan amount. In fact, the banks find it safer and risk-free in lending to an NRI. This is a type of secured loan, where the property purchased becomes collateral. In case the NRI is not willing to pay or unable to pay the loan, the bank will then sell the property and settle the outstanding amount.

The NRI is required to have at least more than 1 year of working experience in a foreign country. The banks also need to know which organization you work for abroad, and what is your current salary. This would help them decide how much they can lend you. The amount is decided as per your financial status abroad. If all documents are up to mark, then getting this loan can be a very easy process and you can get your desired amount, with a reasonable rate of interest.

In terms of documentation, the NRI needs to provide his/her passport, VISA, employment details, employment proof, address proof - these documents are most commonly asked when you apply for the Home Loan.

The Home Loan tenure can range from 15 to 30 years. Some banks might only allow the tenure period of 10 to 15 years. Also, the rate of interest is almost the same for an NRI and resident of India.

An NRI can only settle these monthly EMIs in the Indian National Rupees. But it is possible for the NRI to have an NRE or NRO account in India that can help them convert the currency and deliver the EMI easily in the Indian rupee. These NRE and NRO accounts are provided to Indians living and working abroad, to maintain their saving in India in Indian currency.

Additionally, the NRI Home Loan is not so different from a resident Home loan, but it is always advisable to be updated with any new regulations, in terms of an NRI Home Loan, due to political changes.

Tags

Home Loan, Home Loan Interest Rate

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author avatar Arwind Sharma
Arwind Sharma a passionate writer on finance and closely associated with financial companies. He is still busy in discovering time-efficient finance schemes. To know more about Loan against

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