5 things NRI Home Buyers Must Know About Housing Loan - Home Loan Stories | Kotak Mahindra Bank
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05 MAY, 2021

It is a good feeling when you have a house back in your home country, irrespective of wherever in the world you are. If you are a Non-Resident Indian with similar thoughts, you might have thought of purchasing a house back in India. A housing loan can help fulfil that dream. NRIs can easily avail a home loan in India, but the loan application process for them is usually different. The difference could be in in eligibility criteria and documentation. Therefore, if you are looking forward to availing an NRI home loan, you should know its various aspects before applying.

Here are five things you must know about NRI home loans.


To avail a home loan, you need to fulfil the following eligibility-

  • Your minimum educational qualification should be graduation.
  • You should be employed for at least three years in your current organisation
  • You should be at least 18 years old while applying and not more than 58 years old at the time of maturity of the loan.
  • The income requirement would depend on the tenure you have availed the loan for. The longer the tenure, the higher is the minimum income requirement to avail the loan.

Moreover, to avail a home loan as an NRI, you should also have a resident Indian as a co-applicant or co-borrower. The lender might ask you to issue a power of attorney in the name of the co-applicant.


To avail a home loan in India, you will need to submit the duly filled application form. Along with this, you could also be asked to submit your income proof, 6 months bank statement, salary slips, Income Tax returns, identity proof, age proof and address proof. The lender can also ask you to submit the appointment letter or employment letter of the organisation you are employed with. You can also submit a copy of the employment contract while availing a home loan.


The tenure of the home loan for NRIs is usually much lower than that for resident Indians. As an NRI, you can avail a home loan for a maximum tenure of 15 years, depending on your income and profile.

Tax benefits

Deduction from taxable income can lead to significant tax savings for a home loan borrower. If you are liable to pay income tax in India, you can avail a deduction for the principal repayment for up to Rs 1.5 lakh under Section 80C of the Income Tax Act, 1961. You can also avail a deduction on the home loan interest up to Rs 2 lakh under Section 24(b).           


To repay the loan amount, you can use your NRO or NRE account, remitted from abroad. However, the repayment has to be made in in Indian rupees only.

Interest rates

Usually, the interest rate of NRI home loans is slightly higher than a home loan for resident Indians. It is because lenders consider NRIs as high-risk borrowers owing to their residential status. Therefore, you should be careful while choosing NRI home loans and opt for a lender like Kotak Mahindra Bank that offers one of the lowest interest rates on home loans.


A home loan can be availed for a ready-to-move-in property, under-construction property or extension of an existing property. You can also avail a loan to buy a plot of land. You can avail a home loan of up to 80% of the value of the property. Though the process is simple, as an NRI you could have to submit some additional documents to the lender. Moreover, while buying a house in India, you need not fly down for every formality. A resident Indian who has the power of authority can handle the formalities on your behalf.

Looking forward to owning a house back home? Apply for a home loan now.

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Disclaimer: This Article is for information purpose only. The views expressed in this Article do not necessarily constitute the views of Kotak Mahindra Bank Ltd. (“Bank”) or its employees. Bank make no warranty of any kind with respect to the completeness or accuracy of the material and articles contained in this Newsletter. The information contained in this Article is sourced from empaneled external experts for the benefit of the customers and it does not constitute legal advice from Kotak. Kotak, its directors, employees and the contributors shall not be responsible or liable for any damage or loss resulting from or arising due to reliance on or use of any information contained herein.