According to the UN (United Nations) estimate, nearly 16 million Indians reside outside India in different parts of the world. Indians who live overseas are referred to as NRIs or Non-Resident Indians. Many NRIs stay in touch with their roots back in India, and after living overseas for a few years, wish to settle back in India and buy a home.
While there are many lenders in India that offer special home loan services for NRIs, as a home buyer, you may have certain misconceptions. This could be because of lack of information about how NRI home loan works or you may be referring to an unreliable source to get such information. So, to help the NRIs get the right information and make clear and borrowing decisions, we list down a few common myths and the truth behind them.
NRIs cannot buy a property in India
One of the most common myths prevailing among NRI diaspora is that they cannot invest in a real estate property in India or get a home loan for their property purchase. The truth is that all NRIs are eligible to get a home loan and purchase a property of their choice anywhere in India. However, to get the desired funds, you must meet the lender’s eligibility requirements and submit necessary documents relating to income, and financial stability to prove your repayment capacity.
NRIs cannot apply for a joint home loan
This is another common myth among NRI home loan applicants in India. However, the truth is you can apply for a joint home loan with any of your family members living in India as a co-applicant. All the co-applicants who sign the property document as co-owners can be co-applicants of a home loan.
Getting a joint home is a great way to increase your loan eligibility and get a loan for a higher amount.
NRIs must be in India to apply for a home loan
Today, many financial organisations in India allow the NRI home loan applicants to appoint a representative in India to take care of their home loan-related transactions on their behalf. If you want to appoint a representative in India to act on your behalf, you must give them a power of attorney. Also, with the lenders offering online services, you can apply for the loan online, and upload the necessary documents and complete the process through their portal.
Once the loan’s initial process is complete, the person with the power of attorney can take care of the rest of the formalities.
Lenders charge a higher interest rate on home loans for NRIs
Initially, the lenders in India charged a higher interest on home loans for the NRIs than the resident Indian applicants. However, the provisions are not revised to make home loan affordable for all and suit the specific requirement of the NRI applicants. You can easily get the home at almost the same interest rate as Indian residents.
Now that you are aware of the common myths about NRI home loans in India, make sure that you don’t pay heed to such wrong information. Do your own research about different lenders and home loan offers and make the most out of it.