Finances

Seeking the right finance option that suits your needs to the tee? To help you realise your dream of owning a Sterling residence, we tie-up with major Housing Finance Companies and Banks to devise loan schemes for our various projects. Our innovatively designed packages will help you get flexible and hassle free financial aid at highly competitive rates of interest along with a host of other benefits. For more information call our Sales Team on 022 2405 3886 and they will guide you into your new home.

What are the types of housing loans available?
Various housing loans are offered by financial institutions. Prominent among these are:

• Home Loans
  This is the basic housing loan for the purchase of a new home which covers cost of the flat and parking space, deposits and charges, stamp duty and registration charges.
• Home Improvement Loans
  For implementing repair works and renovations in a home that has already been purchased by you.
• Home Construction Loans
  For the construction of a new house
• Home Extension Loans
  For expanding or extending an existing house.
• Home Conversion Loans
  The existing loan on a house is transferred to a new house, including the extra amount required, eliminating the need for pre-payment of the previous loan.
• Land Purchase Loans
  For both home construction or investment purposes.
• Bridge Loans
  For people who wish to sell the existing house and purchase another and need finance for the new house, until a buyer is found for the old house.
• Balance Transfer
  To pay off an existing housing loan and avail of the option of a loan with a lower rate of interest.
• Refinance Loans
  To pay off the debt you have incurred from private sources such as relatives and friends, for the purchase of your present house.
• Loans To NRIs
  As per requirements of NRIs who want to buy a house in India.

Who can apply for a housing loan?
Any person, including Non Resident Indians, with a steady source of income can borrow funds for financing the cost of a flat from housing finance companies and banks.

Can a Non Resident Indian avail of housing loans?
Yes.

How much can a person borrow?
Loans are generally disbursed upto a maximum of 85% of the cost of the flat. The balance 15% cost of the flat is to be funded by the flat purchaser from his own contribution. The percentage of loan would vary from bank to bank.

How does Sterling assist a flat purchaser for procuring Housing Finance?
All projects at Sterling are pre approved for grant of home loans by leading housing finance companies and banks. The Sterling sales team liaises with the all leading Housing Finance Institutions for project approvals, processing the loan, documentation and disbursement of loans.

What is an EMI?
Equated Monthly Installment ("EMI") is the amount comprising a portion of the interest and the principal loan amount which is payable by a borrower to the lender every month.

How is the rate of interest calculated in India ?
Interest rates vary from time to time and from institution to institution. The interest calculated either on a daily or monthly reducing or yearly reducing balances.

What is a fixed-rate housing loan?
A fixed-rate housing loan is a loan where the rate of interest is constant through the entire term of the loan period.

What is a floating interest rate housing loan?
A floating interest rate loan is a loan where the interest rate payable is linked to the market conditions such as the bank retail prime lending rate and rises and falls with the bank rate varies. Hence a borrower bears the risk of interest rate fluctuations. Floating interest rates offered are usually lower than the fixed interest rates.

What is the difference between monthly reducing interest rate and yearly reducing interest rate?
In a monthly reducing interest system the principal on which interest is paid reduces every month as EMI is paid. In the annual reducing system the principal is reduced at the end of the year, and the borrower pays interest on a certain portion of the principal, which is actually paid back to the lender. The EMI for the monthly reducing system is effectively lesser than the yearly reducing system of calculating interest.

What are the repayment period options?
Repayment period options range generally from 5 to 20 years. Some of the banks may give loans up to 30 years also.

What are the charges for availing a housing loan?

• Processing Fees payable to the lender on applying for a loan and is either a fixed amount not linked to the loan or may also be a percentage of the loan amount.
• Commitment Fees in case the loan is not availed of within a stipulated period of time after it is processed and sanctioned then some institutions levy a commitment fee.
• Prepayment Penalty between 1% and 2% of the amount being pre paid is charged by some institutions when a loan is paid back before the end of the agreed duration.
• Stamp duty and registration fee on a deed of mortgage.
• Miscellaneous costs: such as administrative costs, legal documentation charges, technical consultant charges.

What security is required for a housing loan?
The flat purchased is the primary security and is mortgaged to the lending institution till the entire loan is repaid. Additional security such as life insurance policies, shares, bonds, fixed deposit receipts, national savings certificates can also be offered, as per the requirements of the institution.

Do lending companies require guarantors?
Yes. Many lending companies require 1 guarantor.

What is the time required for approval of a loan application?
About 15 - 20 days

What is the time required for disbursement of loans?
Usually loans are disbursed within 5-7 days after completion of verification by the institution, documentation (such as handing over of the original agreement for sale / lodging receipt to the lender) and completion of all relevant procedures and only after proof that the borrower's own contribution has been paid by him to the Vendor / Builder / Developer.

Do institutions accept joint loan applications?
Yes.

What are the documents required at the time of making an Application for a housing loan?

• Latest salary slip (proof of income for salaried individuals)
• Photographs
• Proof of age
• Identity papers
• Proof of residence
• Bank statements for the previous six months
• For self employed, certified copies of balance sheet, profit and loss statement and tax challans / tax returns for the previous 3 years
• For partnership/private limited companies, the Articles of Association, partnership deed and details about the firm

Do lending institutions offer incentives for housing finance?
Sometimes lending institutions offer incentives for a specified period or under a special scheme. Incentives could be any of the following:

• Free accident insurance
• Waiving of pre payment penalty
• Waiving of processing fee
• Property insurance