Taking a Bank Loan – Tax Plan

Interest paid on housing loan can be claimed as deduction under u/s. 24(b) fully. Such deduction is per person and not for one property.

Repayment of the principal amount of housing loan is also eligible for the deduction u/s. 80c subject to a maximum sum of Rs. 1,50,000/- per year.

Points to be considered while taking Bank Loan
Selection of Bank: It is generally safe to take a loan from scheduled banks or leading financial institutions. Fortune is suggesting to get Housing Loan from DHFL / State Bank of India / LIC Housing Finance Ltd.
Rate of Interest: The rate of interest on housing loans depends on the tenure of the loan, fixed/floating rate, profile of the borrower.
Rate of Interests in some of the scheduled banks are as follows :
Parameters Upto 20 lakhs Above 20 lakhs
Interest Rates 10.25 10.75
Process Fees 0.5 % of loan amount 0.5
Margin 15% 20%
Parameters Upto 30 lakhs Above 30 lakhs
Interest Rates 10.00 10.15
Process Fees 0.5 % of loan amount
Margin 10% 20%
Parameters Upto 15 lakhs Above 15-30 lakhs
Interest Rates 10.75 11.00
Process Fees 1.00 % of loan amount 1.00 % of loan amount
Margin 20% 20%
Tenure of the Loan: Housing Loans are available ranging from 5 years to 20 years. We suggest considering repayment capacity per month, earning potential over the next few years while selecting the Tenure.
Other aspects: Considering the financial profile and Repayment Capacity of the applicant banks provide housing Loan up to 80% cost of the property.
Documents required for getting Bank Loan
Particulars Loan Customer Salaried Loan Customer Business Person Loan Customer (NRI) Guarantor (Mandatory)
1. Address Proof
Yes Yes Yes (Visa) Yes
2. Identity Proof
Yes (Pan Card) Yes (Pan Card) Yes (Visa) Yes (Pan Card)
3. Employment Order
Yes No Yes Yes
4. Salary pay slips
6 Months No 6 Months 6 Months
5. Bank Statement
1 Year 1 Year 1 Year 6 Months
6. IT Returns
3 Years 3 Years 3 Years 1 Year
7. Photos
6 Nos 6 Nos 6 Nos 2 Nos
8. List of Assets & Liabilities
Yes Yes Yes Yes
9. SPA
No No Yes No
Note : Guarantor Documents are Mandatory