Security

A pre-approved property is a property where the HFI has done a legal and technical check on the property documents. The builder gets his property pre approved from various HFIs to increase the marketability of his project. Every HFI has its own methods of carrying out legal and technical checks on the property.

By buying a property in a pre-approved project, you can safely assume that the property is legally and technically clear. For you this means quality construction and authorized construction. Moreover, the documents that you submit to the HFI in a pre-approved project are fewer than in the case if you buy a non – approved project. In a pre-approved project, the only documents that you submit are your own property documents. While in the case of a non approved project, the entire list of documents pertaining to the land along with the various permissions granted to the builder need to be handed over to the HFI.

When a HFI pre approves a property of a developer, it only means that the property is legally and technically clear. This does not mean that the HFI guarantees the performance of the developer. You have to pay off your loan even if the developer delays the construction or even calls off the project completely.

No, most HFIs do not provide finance for buying agricultural land, farmhouse or a holiday home.

No, HFIs do not provide finance for acquiring property abroad. The reason for this being difficulty in verification of the asset and knowledge of foreclosure laws in the country where property is purchased.

No, HFIs do not provide finance towards deposit for taking a house on lease.

Most HFIs insist that either the applicant or the property should be from a location where the HFI has a presence. However, some HFIs do finance properties even if the above two conditions are not met.

Yes, you can rent a property for which you have taken a loan. Here you benefit as you can claim the entire interest paid by you towards the loan installments against the rental income. The balance interest, if any can be set off against other income.

Most HFIs do not give loans to buy commercial premises to non professional or salaried applicants. However, you can reside in part of the property that you have purchased and have an office in the balance portion of your property.

Most HFIs provide for a loan for Non residential premises. However they insist that the applicant needs to be professional who has to be self employed. The terms and conditions of such loans would be different from the normal Home Loan product.

This is an age old system where the owner of the property had leased it to an individual resident decades ago, the individual has paid a large sum upfront and continues to pay a very nominal rent of, say, Rs100 per month.The maintenance of the premises is the responsibility of the resident.
If the resident wants to sell the property, he needs to get a consent from the owner.The owner would give consent provided he gets a share (approx 25-33%) of the sale proceeds.This figure is mutually agreed between the resident and the owner.The transfer of rights to the buyer can happen only if the owner has given his consent to the same, failing which the buyer will have no ownership rights.
Since the whole process is complex, flats under Pugdi system fetch a lower resale value.

No, HFIs do not provide loans for property that is under the pugdi system.

Yes, parking space / garage charges are included in the cost of the property.