Knowledge Center

1. Power of Attorney given to only blood relatives

In India, certain banks like ICICI bank, IDBI bank or Axis bank have the rule to give power of attorney only to blood relatives but other banks like HDFC and standard chartered bank is different in this case. They lend home loans to NRIs and even don’t have any policy of giving power of attorney only to blood relatives as such. In short, we can say that they can give the power to whomever they have trust on like friends or associates. Even some other banks like Citibank and HSBC have introduced new systems of mechanisms where they don’t have any rule of giving the power of attorney to any Indian, just need to include a blood relative as a co- applicant for the loan thus making it more convenient to take any housing loan.

2. Cannot take joint loans with resident Indians

While taking a loan an NRI and an Indian can apply for a joint loan but it would be considered as NRI loan only. After the asset is owned jointly it would have NRI as the principal applicant and his income source will be valid in determining loan eligibility. All the EMI payments will bourne by NRI itself through his non-resident external account. He can even opt for a joint account with an Indian resident by opening a non-resident ordinary account to issue a cheque from that account.

3. Can have shorter tenures and lesser interest

There is a misconception of having shorter tenures or lower interest facility especially for NRIs on taking housing loans. Instead, the rate of interest and loan tenure is the same for both Indians and NRIs. It can be changed only when there is a change in status from NRI to resident and then the loan will rework with the revised income shown thus charging the interest applicable and the tenure taken.

4. Middle-east NRIs cannot get a loan

There is nothing as such and just like all the other countries, the NRIs from middle-east can take a home loan to purchase any property in India. They need to submit an extra document of their work permit translated into English by the government authorized translators for security reasons.

5. Need to visit India once while availing the loan

It is not necessary or compulsory to visit India once while availing a housing loan or through the stages of processing. They just to need to have all the documents like passport copies, place of employment, work experience, work permit and visa in place with self-attested copies submitted to the bank.

6. A home loan cannot be applied to an overseas citizen of India

Overseas Citizens of India have dual citizenship because they hold a foreign passport as well an OCI card to be known as a citizen of India as well. All the housing loan norms are similar to NRIs and are applicable to have the same process. They don’t have the need to pay the taxes to the Indian government and are also not eligible to vote for India.

7. Person of Indian Origins’ can’t buy property in India

Individuals who have foreign passports and foreign nationals can easily avail for housing loans. They need to submit their person of Indian origin card with other requisite documents as they need to have Indian origin. The norms are now quite easy for NRIs but they need to approach a bank in India who has a branch in that area where the property is located to ease all the processing factors.