Home Loan FAQs

Frequently Asked Questions

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What is the maximum amount I can borrow for a home loan?

You can borrow up to 90% (upto 80% for original loan between Rs. 20-75 Lacs, & 75% for original loan above Rs. 75 Lacs) of the cost of the property in case of Home Loan Balance Transfer.

 However in case of Commercial Loans against Property or Loans against an existing property you can borrow up to 60% of the cost of the property. The Home Loan Balance Transfer Amount shall, however, be restricted to the Outstanding Balance of Loan with the existing financer.

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How will my home loan eligibility be determined?

Your home loan repayment capacity as determined by Kotak Mahindra Bank will help decide how much you can borrow.

 Repayment capacity takes into consideration factors such as income, age, qualifications, number of dependent's, spouse's income, assets, liabilities, savings history and stability and continuity of occupation.

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In how many years can I repay the home loan amount?

You can opt for a loan period of up to 20 years or outstanding tenure of the proposed loan to be taken over whichever is lower and can vary depending on your profile.

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Who can be my co-applicant?

If you are an individual - your spouse, your parents, or even your major children can be your co-applicants. The co-owner of a property has to be a co-applicant, but a co-applicant need not be the co-owner of the property.

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When will the home loan be disbursed?

You can take the disbursement after credit, technical and legal appraisals of the property have been done, besides execution of relevant documents & deposit of original property documents is required to be completed prior to disbursement.

 Further, you should have invested your own contribution amount towards the property. 'Own contribution' is the difference between the cost of the property and the loan amount.

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How to apply for a home loan?

You Can avail a home loan with Kotak Mahindra Bank, by applying online or visiting our nearby branch.

Online Process:

 

Our representative will get in touch with you for processing your online application.

 

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Does the property have to be insured?

Your home is your pride and joy. Don't let unplanned events take it away. Property insurance will take care of home in case an unforeseen event strikes.

 Also, we offer Insurance options to cover your Home Loan Liability. That way, you will be at peace that you and your loved ones will not lose your home.

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What kind of security is required?

In most cases, the property itself, bought or intended to be bought, becomes the security till the entire loan is repaid.

 In some cases additional security such as life insurance policies or Term Deposit receipts of Kotak Mahindra Bank (if available) can be provided.

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Is there any tax benefit available on home loans?

Yes. Borrower can claim tax benefits on the availed home loan as per below details.

  • Tax benefits on principal repayments:  Up to Rs. 1.5 lakh as principal repayment on your home loan will be allowed as a tax deduction under U/S 80C and 80CCE of the IT Act of 1961 if it’s a first home. In case of second home or under construction properties, tax benefits on principal repayments will not be applicable.
  • Tax benefits on interest paid: Tax benefits on interest paid vary depending on self-occupied or let out property or if the property is under construction.

Summary of tax benefits on principal and interest paid is as below

Tax Benefits On Principal Repaid On Interest Paid
First Home – Self Occupied Actual principal repaid subject to a maximum of Rs. 1,50,000 (Rs. 2 lakh for senior citizens) can be claimed as investment eligible for tax deduction under section 80C. Actual home loan interest paid subject to a maximum of Rs. 2 lakh (Rs. 3 lakh for senior citizens) if house construction completed within 5 years from the end of the financial year in which loan is taken
If construction of house not completed within five years then Rs. 30,000 is tax exempt
Additional exemption of upto Rs. 50,000 on interest paid for loans upto Rs. 35 lakh with cost of home upto Rs. 50 lakh.
First Home – Rented/ Vacant (deemed to be let out property) Upto Rs. 1,50,000 (Rs. 2 lakh for senior citizens) eligible for tax deduction under Section 80 C. The deduction is available only if the property owner is staying in a different city for work. Exemption on interest is capped at lower of two, a) Rs. 2,00,000 or b) actual interest paid for all properties owned by a tax payer.
Second Home or Additional Property None Exemption on interest is capped at lower of two, a) Rs. 2,00,000 or
b)actual interest paid for all properties owned by a tax payer
Under Construction Property None The interest paid can be claimed in equal parts in five financial years post completion or handing over of property within the overall annual limit of Rs. 2 lakh.

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Is Prepayment of Home Loan allowed?

NIL.

For HL Top up:

Micro & Small Enterprises - NIL

Floating rate Term Loans for Individuals for Personal Purpose - NIL

Others : No prepayment / foreclosure is allowed until a Lock-in Period of 6 months after EMI Commencement.

Others : No prepayment / foreclosure is allowed until a Lock-in Period of 6 months after EMI Commencement.

Post this lock– in period, part prepayment of minimum INR 25,000 and maximum of up to 25% of outstanding Loan Amount can be made without any prepayment charges every 6 months.

The minimum period between any two prepayment shall be at least 6 months.

For any Part Prepayment in excess of 25%, 4% (plus GST and statutory dues) of the excess prepayment Amount shall be charged as Prepayment Charges.

For Full Prepayment any time after the Lock-in-Period, Prepayment charges shall be 4% (plus GST and other applicable taxes) of the Foreclosure Loan Amount plus Amounts prepaid during the last 12 months.

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Can I close my Home Loan? What are the Charges for prepaying my loan?

NIL.

For HL Top up:

Micro & Small Enterprises - NIL

Floating rate Term Loans for Individuals for Personal Purpose - NIL

Others : No prepayment / foreclosure is allowed until a Lock-in Period of 6 months after EMI Commencement.

Others : No prepayment / foreclosure is allowed until a Lock-in Period of 6 months after EMI Commencement.

Post this lock– in period, part prepayment of minimum INR 25,000 and maximum of up to 25% of outstanding Loan Amount can be made without any prepayment charges every 6 months.

The minimum period between any two prepayment shall be at least 6 months.

For any Part Prepayment in excess of 25%, 4% (plus GST and statutory dues) of the excess prepayment Amount shall be charged as Prepayment Charges.

For Full Prepayment any time after the Lock-in-Period, Prepayment charges shall be 4% (plus GST and other applicable taxes) of the Foreclosure Loan Amount plus Amounts prepaid during the last 12 months.

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Who can be joint borrowers in case of a Home Loan?

Co-Borrower can be spouse, parents or brother or son, but income of co-borrower is consider as per home loan policy of Kotak Mahindra bank.

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What is the maximum number of Joint borrowers for a Home Loan?

There is no capping of upper limit of number of co-borrower, however minimum one co-borrower is required.

Note: Member who all are party to agreement must have to come up as o borrower / co-borrower.

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What is a floating rate Home Loan?

Floating rate of interest is the interest rate, which changes with time because of multiple factors. If rate of interest is increased by the lender, then rate of interest increases for all the customers who have availed a home loan on floating rate and hence customer EMI also increases.

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What is an amortization schedule?

An amortization schedule is a table detailing each periodic payment on Loan as generated by an amortization calculator. Amortization refers to the process of paying off a debt (often from a loan or mortgage) over time through regular payments. A portion of each payment is for interest while the remaining amount is applied towards the principal balance. The percentage of interest versus principal in each payment is determined in an amortization schedule.

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What is the usual time required for disbursement of a Home Loan?

In Kotak Mahindra Bank time require for disbursement is 2 working days after submitting all relevant document as per legal or any other document required.

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Can I sell the property even when the Home loan is outstanding?

No, borrower cannot sell property without clearing outstanding home loan amount of existing bank/financial institution.

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What does market value of the property mean?

The market value of a property is the price at which that property is exchanged between a buyer and a seller on the date of valuation / execution of Agreement.

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Who can avail subsidy under CLSS in PMAY?

A beneficiary family that does not have any pucca house in any part of India is eligible for a subsidy through PMAY, as per the income criteria defined for the family.

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What is the definition of beneficiary family in accordance to PMAY?

The beneficiary family as defined under PMAY will comprise of the husband-wife and their unmarried children. An adult earning member (irrespective of marital status) can be treated as a separate family/household.

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Is PMAY scheme applicable for properties in rural areas?

It is not.

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Is women ownership mandatory for being eligible for this subsidy under PMAY?

Women ownership or co-ownership is mandatory for EWS and LIG only. However, this condition is not mandatory for self-construction / extension. Women ownership is not mandatory for MIG-I and MIG-II.

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What is the process of claiming interest subsidy under PMAY?

After the loan is disbursed, the required details are sent by the bank to the NHB (National Housing Bank) for validation of data and other checks. The NHB, after necessary due diligence, approves the subsidy to the eligible customer/borrower.

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How will I receive the interest subsidy that I’m eligible for under PMAY?

Once the subsidy amount is received from the NHB, it is credited to the borrower’s home-loan account as a part payment, and the EMI is proportionately reduced.

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Is there any limit prescribed under PMAY on the loan amount or cost of property?

There is no limit. However, the subsidy will be limited to a defined loan amount for each category (see details in the table above); any loan amount in excess of this defined amount will bear the non-subsidised rate of interest.

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For availing the subsidy under PMAY, what additional documents do I need to provide?

You do not need to provide additional documents except for a self-declaration (in the format that the bank will provide) that you do not own any pucca house.

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Can NRIs avail this subsidy under PMAY?

Yes

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I have a small business. Can I avail a home loan under PMAY?

Yes, you can avail this facility, subject to meeting the income and other criteria defined under this scheme.

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Is it mandatory to provide the Aadhaar Card details for all the member of the beneficiary family?

Yes. For processing the subsidy under PMAY CLSS for MIG-I and MIG-II schemes, it is mandatory to furnish the Aadhaar Card details of all family members.

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How to calculate home loan interest rates?

You can calculate home loan interest rates using our Home Loan eligibility calculator (https://rcasprod.kotak.com/home-loan). Enter your basic  personal and employment details and on submission, you will be able to see  interest rate, applicable to you, basis your profile.

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What is processing fees in home loans?

Processing fees is a one-time charge collected while availing a fresh home loan. A processing fee of upto 0.5% of loan sanction amount (as applicable) plus GST, is payable.

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What are the advantages of Home Loan EMI Calculator?

A Housing Loan EMI Calculator helps you to calculate the monthly installment amount and decide whether you can afford the financial commitment of a home loan in the long term. If you want, you can change your EMI amount depending on the amount of loan you are taking and the time period for which you'll be paying the EMIs

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What is a home loan?

A home loan, also known, as a housing loan is an amount of money borrowed by an individual to purchase a house. The money is borrowed from a bank or a financial institution at a certain rate of interest and is paid back in easy monthly installments over a long tenure.

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How do home loans work?

A home loan makes it easy for an individual to fund the purchase of his dream house by providing a lump-sum loan amount based on eligibility. Banks or lending institutions generally fund 75%-90% of the property value, enabling the borrower to purchase his dream house and repay the amount in EMIs in flexible tenures. 

However, we at Kotak Mahindra Bank understand that buying a house is not only a sought-after 'next step' for you but also a valuable investment. So, our Home Loans are designed to simplify the entire process and make it seamless, hassle-free and quick. We at Kotak Mahindra Bank provide housing loans at attractive interest rates for tenure up to 20 years, along with extending to you the option of an insurance policy.

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How to apply for a home loan?

With the advanced and digital savvy journeys like ours, availing a home loan has become simple; it usually involves the below phases.

Application: Apply for a home loan online or at a nearest branch/loan center

Document Submission: Check on the home loan documentation list and submit the required documents

Loan sanction: Post successful submission of the application and documents, the bank does a KYC check and verification of your financial stability after which the loan is sanctioned.

Review: Once the loan is sanctioned, you will have to submit the property documents, which will be checked by the technical and legal teams of the bank.

Disbursal: The bank shall approve the loan based on verification of the property.

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What are the different types of home loan available in India?

Some of the different types of home loans you can take are: home improvement loan, home repair loan, home purchase loan, home extension loan, and land purchase loan with self-construction home loan.

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Can I take 2 home loans at a time?

Yes, you can take 2 home loans at a time. However, the chances of loan approval depend on your eligibility criteria including your income, credit score, existing banking relationship, debt to income ratio and other such parameters.

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What is the minimum salary required for a home loan?

The minimum salary required for a Kotak Mahindra Bank home loan is Rs. 20,000 for individuals in Delhi, Mumbai, Bangalore, Pune and Chennai. It is Rs. 15,000 for other cities.

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Can I get 100% home loan?

No, you cannot get a 100% home loan for the purchase of any property. We at Kotak fund around 75% to 80% of the property value.

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How much home loan can I get if my salary is 25000?

The loan amount you can get at a salary of Rs. 25,000 depends on various factors including your credit score, monthly income, existing EMI payout, age and location. You can use the home loan EMI calculator to get an estimate of the loan amount you are eligible to get at the salary of Rs. 25,000.

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What is Pre-EMI?

Pre-EMI refers to the payment of the interest component on the disbursed loan amount. With Pre-EMI, you are not repaying the principal amount, but only paying the interest on the amount borrowed. The option of pre-EMI is applicable only when the home or the property you intend to purchase is under construction. Once you receive possession of the property, you will be asked to repay the EMIs in full.

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What are the reasons for home loan rejection?

Some of the reasons for home loan rejection are: poor credit score, frequent job changes, property issues, age, incomplete documentation and high debt-to-income ratio.

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Can I get a loan for land purchase?

No, we do not offer a home loan only for land purchase.

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When does the home loan repayment period start?

Repayment of the home loan starts from the period any loan amount is disbursed. 

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Is home loan insurance mandatory?

It is not mandatory to take home loan insurance. The insurance protects the borrower’s outstanding loan in case of any unforeseen event strikes during the tenure. However, we strongly recommend taking a home loan insurance to add protection to your home.

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