Home Loan!!

Querist : Anonymous (Querist) 14 January 2010 This query is : Resolved
Dear Sir / Madam,

Recently i have applied for home loan and got sanction from one of the nationalised bank. I am suppose to pay 70% of the total property cost to builder as the building is under construction. but my question is even though bank is going to give me disbursement of 70% of my sanction amount they are saying that the EMI which i need to pay every month would be same even if they giving 70% of total sanction amount. Is this feasible. It would be great help if you could help me to understand the same.

Regards,

Atanu

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A V Vishal (Expert) 14 January 2010
Pending final disbursement, you pay interest on the portion of the loan disbursed. This interest called pre-EMI interest. Pre-EMI interest is payable every month from the date of each disbursement upto the date of commencement of EMI.

To help customers save pre-EMI interest, some banks have introduced a special facility of Tranche Based EMI.

For under construction properties customers can choose the instalments they wish to pay, till the time the property is ready for possession. Anything paid over and above the interest during the pre-emi period by the customer goes towards Principal repayment.

The customer benefits by starting EMI and hence repays the loan faster.

adv. rajeev ( rajoo ) (Expert) 14 January 2010
I think it is better to follow the advise of the vishal.

Raj Kumar Makkad (Expert) 14 January 2010
Banks are free to make their own rules qua the terms of the loan to be disbursed so it is advised to follow their terms instead of seeking legal advice in this community. You can try to negotiate with them.

Guest (Expert) 20 January 2010
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