Loan Sanction

The loan sanction amount depends on your repayment capacity - based on your total current income and your future repayment capacity. Your spouse's gross income can be added to enhance the loan amount eligibility. The maximum loan that can be sanctioned varies with each bank/institution and generally ranges from Rs.10 lakhs to Rs.1 crore.

Re-Payment

Usually loan tenures range from 5 years to 20 years and does not extend beyond the age of retirement or when you turn 65 years of age - whichever comes first. The EMI - Equated Monthly Installment is the amount of money you repay every month until the end of the loan tenure - which comprises both principal component and an interest component.

Services

Most HFCs / Banks offer a wide range of personalized home loan services. Sometimes sanctioning loans even before a property is identified. Additional charges other than interest usually include processing and administrative charges and are expressed as a percentage of the loan amount - usually 1% to 2% of the loan amount.

Tax Benefits

The Income Tax Act 1961, allows tax concessions on both the principal and interest components of the loan. The upper limit of the amount of deduction of interest payment deductible from your gross total income is now Rs.1,50,000 per annum. In addition, sec. 88 offers tax benefits for principal repayments up to Rs.20,000.