Home loans have become a boon to the ones who wish for a home of their own. For ready-to-move-in houses, the majority of the lenders disburse funds as a single instalment. With a home loan for the under-construction property, you are not burdened with handling a huge loan amount at once. The funds are disbursed as and when the construction requires.
Properties under-construction are usually cheaper and are priced 20% less than normal. When you apply for an under-construction home loan, it becomes affordable due to this. The home loan disbursement process for under-construction property for the approved loan amount occurs in several instalments and is dependent on the construction progress.
Let us check out the details of the process of home loan for under-construction projects here.
Here is the list of under-construction house loan interest rates offered by various lenders.
Lender |
Interest Rate for Under Construction Property Home Loan |
Bajaj Finance Limited |
Starts at 7.10% per annum |
ICICI Bank |
Starts at 7.60% per annum |
PNB Housing Finance Limited |
Starts at 6.99% per annum |
Union Bank |
Starts at 7.40% per annum |
Axis Bank |
Starts at 7.60% per annum |
State Bank of India |
Starts at 7.55% per annum |
RBL Bank |
Starts at 9.50% per annum |
Citi Bank |
Starts at 6.50% per annum |
Yes Bank |
Starts at 8.95% per annum |
Disclaimer: The interest rates are subject to change as per lender’s discretion.
You only have to pay the interest component of your home loan until you get possession of your house. It is termed the Prior Period Interest (PPI).
Here is a list of home loans for under-construction properties and what it is best for.
Home Loans for Under Construction Properties |
Best Suited For |
Bajaj Finance Limited Home Loan |
Lower interest rates |
PNB Housing Finance Home Loan |
Home buyers in rural areas |
ICICI Bank Home Loan |
Longer Repayment |
Union Bank of India |
Approved projects |
SBI Regular Home Loan |
Special rates for women |
Axis Bank Home Loan |
Late Possession |
The general criteria that need to be fulfilled by a customer to avail a home loan under-construction projects for various lenders are mentioned below.
Nationality |
Resident Indian |
Age |
|
Occupation |
|
Work Experience |
For salaried individuals not less than 3 years and for self-employed individuals not less than 4 years. |
Income |
Salaried individuals must earn a minimum of Rs. 1 Lakh per annum and self-employed individuals must earn a minimum Rs. 1.5 Lakhs per annum |
Other Conditions |
A good credit score without any defaults in the history of loans and statutory payments. |
Here is the general list of documents required for a home loan for under-construction property.
Identity Proof |
Driving Licence or PAN Card or Passport, or Voter ID |
Address Proof |
Telephone, water, gas and electricity bills or rental agreement |
Income Proof |
|
Property Proof |
|
You can apply for a home loan for under-construction properties via Bajaj Markets. Follow the steps mentioned below to do so.
Step 1: Fill in your personal details: Visit the Bajaj Markets website or app and enter your personal and professional details to check your housing loan eligibility for a home loan for under-construction properties.
Step 2: Select your lending partner: Select a lending partner of your choice.
Step 3: Check your borrowing power: Estimate the maximum amount of loan that you can avail from the lender via Bajaj Markets.
Step 4: Enter your requirement and the details of the property: Enter the loan amount and fill in the details of the property for which you are taking the loan.
Yes, you can avail a home loan on an under-construction property. You can choose Bajaj Markets to avail a home loan of your choice from different lenders.
Yes, up to Rs. 2 Lakhs and up to Rs. 1.5 Lakhs can be availed for the interest and the principal component of the home loan respectively as tax benefits on home loan for an under-construction property. It can be claimed only after the receipt of the Occupancy Certificate from the builder.
The home loan amount for under-construction properties are disbursed in instalments. It is because the amount is released according to the requirements of the stage of construction and the interest will be charged only on the amount.
For a home loan for under-construction property, you have to pay the EMI from the start of construction of the property. The interest amount will be calculated based on the amount disbursed to the builder while the remaining amount will be counted towards principal.
Yes, you can pay full EMI for under-construction property. However, it is dependent on the lender to decide whether you should be given the option for full EMI payments instead of pre-EMI payments.
If the individual taxpayer in India is fulfilling the conditions as mentioned in Section 80EEA of the Income Tax Act, that person is eligible to claim the tax benefits even in the pre-construction period.