RBI eases norms for home loans for up to Rs 10 lakh

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RBIThe Reserve Bank of India (RBI) has eased the norms for home loans for up to Rs 10 lakh by allowing banks to include stamp duty and registration charges to the cost of a unit.

These charges form around 15% of the cost of the house and place a burden on borrowers. Inclusion of these costs in LTV (loan to value) calculation will ease the burden on the borrower to a great extend.

“With a view to encourage availability of affordable housing to such borrowers, it has been decided that in cases where the cost of the house does not exceed Rs 10 lakh, banks may add stamp duty, registration and other documentation charges to the cost of the unit for calculating LTV (loan to value) ratio,” RBI said in a notification.

The RBI also said that in cases of projects sponsored by government, statutory authorities, banks may disburse the loans as per the payment stages prescribed by such authorities, even where payments sought from house buyers are not linked to the stages of construction.