RSS Feed
Twitter
7:34 AM
Blogger
In the backdrop of banks focussing on retail loans to ride out the current economic slowdown, Union Bank of India has pushed the envelope by extending the maximum age by when home loans can be repaid to 70 years.
The move also comes in the wake of increased life expectancy coupled with senior citizens, especially former Government employees, drawing higher pensions, getting income from post-retirement employment or business.
What this means is that you can decide on taking a home loan (it could be the first, second or third one during your lifetime) even when you are in your 50s, irrespective of whether you belong to the salaried or non-salaried class.
Previously, the bank had pegged the maximum permissible age by when repayment of the last instalment of home loan had to be made for salaried and non-salaried class of borrowers at 60 years and 65 years, respectively.
The move also comes in the wake of increased life expectancy coupled with senior citizens, especially former Government employees, drawing higher pensions, getting income from post-retirement employment or business.
What this means is that you can decide on taking a home loan (it could be the first, second or third one during your lifetime) even when you are in your 50s, irrespective of whether you belong to the salaried or non-salaried class.
Previously, the bank had pegged the maximum permissible age by when repayment of the last instalment of home loan had to be made for salaried and non-salaried class of borrowers at 60 years and 65 years, respectively.
Extended tenure
As part of its revamped home loan policy, the bank, in a bid to encourage young salaried / self-employed people to have a home of their own, has extended the maximum tenure for loan repayment to 30 years (from 25 years).
The extended tenure was aimed at easing the instalment burden, said Pravin K. Bansal, General Manager, Union Bank.
With house prices remaining high at most metros, the public sector bank has decided to do away with the ceiling on the maximum quantum of loan for purchase of a flat/ house. The quantum of home loan will be based on the repayment capacity of the borrower and margin norms.
Previously, the maximum quantum of loan for purchase of a flat/ house was Rs 5 crore in metros, State capitals and the NCR, Rs 3 crore in urban centres and Rs 1 crore in semi-urban and rural centres.
During the last four years, the Reserve Bank of India’s index of house prices has increased by over 110 per cent (up to January-March 2012-13). The index comprises nine cities — the four metros apart from Bangalore, Ahmedabad, Lucknow, Jaipur and Kanpur.
Union Bank has also relaxed the norms relating to the age of the house that can be financed. Its branches will consider loan applications for purchase of house up to 25 years old (previously it was up to 15 years old).
Further, the regional level credit committee has been empowered to consider loans for houses older than 25 years (previously, older than 15 years).
Bansal said the bank had also set a tight turnaround time for home loans and auto loans at five days and three days, respectively, provided the customer documents were in order.
The aim is to grow the bank’s retail loans portfolio to about Rs 25,000 crore by March-end 2014 against Rs 19,560 crore as at March-end 2013.
Source: thehindubusinessline
The extended tenure was aimed at easing the instalment burden, said Pravin K. Bansal, General Manager, Union Bank.
With house prices remaining high at most metros, the public sector bank has decided to do away with the ceiling on the maximum quantum of loan for purchase of a flat/ house. The quantum of home loan will be based on the repayment capacity of the borrower and margin norms.
Previously, the maximum quantum of loan for purchase of a flat/ house was Rs 5 crore in metros, State capitals and the NCR, Rs 3 crore in urban centres and Rs 1 crore in semi-urban and rural centres.
During the last four years, the Reserve Bank of India’s index of house prices has increased by over 110 per cent (up to January-March 2012-13). The index comprises nine cities — the four metros apart from Bangalore, Ahmedabad, Lucknow, Jaipur and Kanpur.
Union Bank has also relaxed the norms relating to the age of the house that can be financed. Its branches will consider loan applications for purchase of house up to 25 years old (previously it was up to 15 years old).
Further, the regional level credit committee has been empowered to consider loans for houses older than 25 years (previously, older than 15 years).
Bansal said the bank had also set a tight turnaround time for home loans and auto loans at five days and three days, respectively, provided the customer documents were in order.
The aim is to grow the bank’s retail loans portfolio to about Rs 25,000 crore by March-end 2014 against Rs 19,560 crore as at March-end 2013.
Source: thehindubusinessline
0 comments:
Post a Comment