Things to Consider while Taking an NRI Home Loan

Over many years, Indians have immigrated to various countries and have spread our history, culture, sense of patriotism and culinary delights among the original inhabitants of those countries. Though many Indians have made a foreign country as their home, the emotion of belongingness towards India resides in every NRI. An NRI Home Loan fulfills the dream and passion of an NRI to own a home in India. Many Banks offer tailor made Home Loan schemes for NRIs at exclusive interest rates, terms & conditions and there are quite a few things an NRI must consider while taking an NRI Home Loan.

WHO IS NRI?

Under the Foreign Exchange Management Act 1999, NRI’s include the following:

Indian citizens who stay abroad for employment or for carrying on business or vocation outside India or for any other purpose in circumstances indicating an indefinite period of stay abroad
Government servants who are posted abroad on duty with the Indian missions and similar other agencies set up abroad by the Government of India where the officials draw salaries out of Government resources
Government servants deputed abroad on assignments with foreign Governments or regional/international agencies like the World Bank, International Monetary Fund (IMF), World Health Organization (WHO), Economic and Social Commission for Asia and the Pacific (ESCAP)
Officials of state governments and public sector undertakings deputed abroad on temporary assignments or posted to their branches or offices abroad
Mariners on ships (Merchant Navy)

What are the types of Housing Loans available in India?

Finance is available for construction, purchase and renovation of a house.

Is foreclosure allowed and will there be a penalty for this?

Yes. Foreclosure of Home Loans is allowed before the expiry of the original loan tenure. Banks do not charge a penalty for floating rate home loans.

Can an NRI Home Loan borrower switch between the types of interest rates?

Most Banks offer NRIs, the liberty of switching between fixed interest rates and floating interest rates.

Banks understand the need of an NRI to have a pleasant home buying experience. By offering NRI home loans with a convenient loan process and documentation that is not cumbersome, many Banks and lending institutions fulfill the dreams of NRIs to own a home in India and bond with their near and dear, back home.

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**Disclaimer: Interest rates and market conditions are subject to change. This information is accurate as of July 2025 and is meant for informational purposes only. Please consult with certified financial advisors for advice specific to your situation. Home loan approval is subject to the bank's terms and conditions.

Credit at sole discretion of Kotak Mahindra Bank Ltd. and subject to guidelines issued by RBI from time to time. Bank may engage the services of marketing agents for the purpose of sourcing loan assets.

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.

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