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Indian Overseas Bank Home Loan

Home Loan Bank Information

Bank Name
Interest
Tenure
Processing Fees
AMBAK
8.25%
0 - 30
YEARS
0 %
+ GST
BASIC Home Loan
8.35%
0 - 28
YEARS
Rs 999
+ GST
PNB Housing Finance Limited
8.5%
1 - 30
YEARS
Rs 999
+ GST
Canara Bank
8.4%
1 - 30
YEARS
0.5 %
+ GST

Table of Contents

 

Introduction

Indian Overseas Bank has come a long way since their founding in 1937 in Tamilnadu with stress on Foreign Exchange Business. One of the fourteen banks to be nationalized in 1969, they have aligned with the objectives of public sector banks with a focus on social banking. Indian Overseas Bank, being one of the leading public sector banks in the country, offers a host of home loan solutions as an important segment of their retail business. .

Recognizing the fact the cost of owning a house or flat is prohibitively expensive, Indian Overseas Bank has designed a bouquet of home loan plans to cater to all sections of the society.  Matching personal needs and preferences is the focus of their home loan schemes. In tune with the trend, they claim to provide best of terms and competitive interest rates to ensure satisfaction of their clientele.

Indian Overseas Bank Home Loan Interest Rates

Interest Rates are as of 2019

For any credit facility, more so for the housing loan, a great concern for the borrower is the cost of capital. Thus it makes sense to first ascertain the kind of interest rates the bank offers and also the other underlying charges that impact the overall cost of capital.

Indian Overseas Bank offers Floating rate of interest for home loans linked to benchmark MCLR at 8.65 effective from 10th July, 2019.

Rate of interest  for IOB Home Loan
Loan Type Amount Range MCLR Spread Effective rate
Housing Loan Up to Rs.30L 8.65% 0.00 8.65%
Rs.30L to Up to Rs.75L 8.65% 0.10 8.75%
Over Rs.75L 8.65% 0.25 8.90%
Top up 8.65% 3.50% 12.15%
Home Improvement Up to Rs.2L 8.65% 0.20% 8.85%
Above Rs.2L 8065% 0.35% 8.90%

 

On top of the interest you have to factor in the upfront processing charges as they impact the cost of capital.

Processing Charges for different IOB Home Loan
Loan Type Amount Range Charge rate
Housing Loan all types Up to Rs.75L 0.50% maximum Rs.20000
Over Rs.75L 0.50% maximum Rs.25000
Top up irrespective of amount 0.75% maximum Rs.25000

Eligibility Criteria for IOB Home loan

The diverse schemes are suggestive of different eligibility norms, which need to be elaborated:

Various interest rates across IOB Home Loan Schemes.
Scheme Eligibility Criteria
Subha Gruha Housing Loan
Type Details
For Whom Salaried and Non-Salaried Individuals and Co-ops
Service Term
  • Salaried: Minimum 2 to 3 years of permanent job
  • Self-Employed Professional: Minimum 3 years.
Age Entry age not more than 55 years, in special cases 60years but loan to be liquidated by 70 years of age.
Quantum 75% to 90% of the cost of the property
Margin 10% to 25% of the loan quantum
Repayment Maximum 30 years
Moratorium Maximum 18 months
Subha Gruha Next Gen Housing Loan 
Type Details
For Whom Employees of MNCs, Government Offices and PSUs
Income Minimum Rs.30000 pm
Age Between 21 and 45 years
Quantum 20% higher than normal home loan
Margin 10% to 25% of the loan quantum
Repayment Maximum 30 years
Moratorium Maximum 36 months
Subha Gruha Pre Approved Home Loan
Type Details
For Whom Salaried and Non-Salaried Individuals and Co-ops
Income
  • Salaried: Minimum 2 to 3 years of permanent job
  • Self-Employed Professional: Minimum 3 years.
Age Entry age not more than 55 years, in special cases 60years but loan to be liquidated by 70 years of age.
Quantum 20% higher than normal home loan
Margin 10% to 25% of the loan quantum
Repayment Maximum 30 years
Moratorium Maximum 18 months
Validity 3 months
Subha Gruha Housing Loan CC
Type Details
For Whom Existing SB/CD account holders
Minimum balance Rs.5000
Age Same as Subha Gruha
Quantum Cash Credit facility with reducing balance equal to the EMI every month.
Margin 10% to 25% of the loan quantum
Repayment Maximum 30 years
Moratorium Maximum 36 months
Subha Gruha Home Improvement Loan
Type Details
For Whom Salaried and Non-Salaried Individuals and Co-ops
Service Term
  • Salaried: Minimum 2 to 3 years of permanent job, min 50% take home pay
  • Self-Employed Professional: Minimum 3 years.
Quantum
  • Minimum: Rs.0.25L
  • Maximum: Rs.15L
Repayment Maximum 12 years
Subha Gruha Top Up Loan
Type Details
For Whom Existing Home Loan borrowers with 1 year repayment
Quantum
  • Minimum: Rs.050L
  • Maximum: Rs.2C
Margin 50% of the project
Repayment Same as the existing loan

Indian Overseas Bank Home Loan Schemes

Now that you have a clear picture of the cost of capital as a whole up front, you need to learn about all the home loan schemes the bank offers. As for the charges, there are host of others that may be levied depending upon the evolving situation. Now take a look at all the schemes in their bouquet of home loans and also recapitulate the rate of interest applicable in each of them.

 

Various interest rates across IOB Home Loan Schemes.
Scheme Interest 
Subha Gruha Housing Loan 8.65% to 8.90%
Subha Gruha Next Gen Housing Loan 8.65% to 8.90%
Subha Gruha Pre Approved Home Loan 8.65% to 8.90%
Subha Gruha Housing Loan   CC 8.65% to 8.90%
Subha Gruha Home Improvement  Loan 8.65% to 8.90%
Subha Gruha Top Up  Loan 8.65% to 8.90%
NRI Home Loans 8.65% to 8.90%

 

Types of Indian Overseas Bank Home Loan

Indian Overseas Bank portfolio of home loans is full of diversity, especially in its form. All the home loans are Term credit in nature barring one which is in the form of a cash credit with reducible balance linked with appropriate drawing power.

If you have to name any single home loan as the main, it has to be their Subha Gruha, which is the basis of all other loans. It is best to take a brief glimpse at all of them.

Subha Gruha Housing Loan: It is an all purpose loan that allows the eligible borrowers to build new residence, buy ready home whether new or old, or even renovate your accommodation.

Subha Gruha Next Gen Housing Loan: It is a special type of loan where the borrowers are restricted to employees of reputed organizations or Government servants. As a bonus they can increase their eligible loan amount by 20%.

Subha Gruha Pre Approved Home Loan: It is a unique facility where the borrower is yet to finalize the deal with a builder. Even then a provisional approval has been accorded, which is valid for 3 months.

Subha Gruha Housing Loan   CC: Since the facility allows parking of idle funds, the actual outgo of the interest will be lower than the normal term loan.

Subha Gruha Home Improvement  Loan: This loan gives a wide choice to the borrowers. You can add, modify, repair, renovate, restore and beautify the house as per your choice.

Subha Gruha Top Up  Loan: This loan provides for additional funds to the existing home loan borrower, but only if you have completed one third of your repayment tenure.

IOB Home Loan for NRI or PIO

The NRI and PIOs have been given adequate attention by Indian Overseas Bank and have a home loan plan for them. It is all  encompassing alike the home loans offered to the resident Indians.

However, an NRI has to conform to the law of the land and they are required to fulfill the norms set by the RBI and the regulations framed under FERA. Still they are allowed a wide berth being able to build /buy a house / flat or repair and renovate their existing house.

 

Housing Loan for High-net-worth Individuals

Like all lenders, Indian Overseas Bank values their high-net-worth-individuals. They are perceived in the common parlance to possess huge liquid assets as a surplus over their liabilities. They are the prospective borrowers who can propose high costing projects. Due to their high credit worthiness, they do not have to face the possibility of default in the service of the loan.

However, Indian Overseas Bank does not provide any Premium Services.

 

Loan amount limits under this Home Loan Scheme

The features in various Indian Overseas Bank home loans permit the quantum limited to 75% to 90% of the proposal. The upper limit has not been specified for reasons of flexibility.

 

Indian Overseas Bank Home Loan for NRI

Before dwelling on the various features of the home loan for the NRI and the PIO, it is prudent to familiarize with the two terms.

NRI: It is an acronym for Non Resident Indian who is an Indian citizen holding a valid passport. Yet he is residing abroad for an uncertain period for reasons of employment, business or any other compulsion.

PIO: It is an acronym for Persons of Indian Origin who holds a foreign passport of another country. The countries barred are Pakistan, Bangladesh, Sri Lanka, Nepal, Afghanistan, China, Iran  or Bhutan.

The individual or his ancestor must have been an Indian citizen in the past.

As per the rules of RBI, a prospective borrower is entitled to own property or residence in the country both new and old, but cannot purchase farm land.

Most NRIs see the ownership of residence here as an investment opportunity and a backup for retired life. The handsome return accrued out of residential properties is reason enough for them to harbor their funds in these schemes.

 

A glimpse of the salient features of the loan reveals:

NRI Home Loan
Type Details
For Whom NRI and PIO as defined above.
Purpose To buy/ build house / flat or renovate existing residence
Income
  • 20 times of monthly salary.
  • Minimum salary equivalent to Rs.10000
Loan Amount
  • For Building / Buying: 80% of the project cost subject to a maximum of Rs.50L
  • For Renovation: Rs.5L
Quantum
  • 90% For loans up to Rs.20L
  • 80% For loans up to Rs.75L
  • 75% For loans above Rs.75L
Margin 10% to 25% of the loan quantum
Processing Charges 0.57% of the loan amount subject to minimum Rs.15000
Repayment Maximum 15 years
Mode of repayment
  • EMIi to the debit of NRE/ NRO/ FCNR account or remittance.
  • A resident close relative through the account
Moratorium
  • 6 Months for purchase of house.
  • 3 months for renovation
  • 18 months if the house is constructed
Security
  • Equitable mortgage of the property.
  • The property should be appropriately insured.

 

In addition there is also a home loan provision for close relatives of NRI. Let us have a look at its salient features.

  • The loan is granted on the guarantee of the NRI.
  • The applicant should be resident Indian.
  • The minimum salary of the NRI should be equivalent Rs.15000.
  • Income of the applicant can be considered for employees of reputed concerns and government offices.
  • The NRI status should be for a period of minimum of 3 years.
  • Property should be registered in the name of the resident.
  • The amount of loan shall be:
    • 20 times of the gross salary
    • Maximum Rs.20L for construction or  acquisition.
    • Maximum Rs. 3L for renovation subject  to 25% margin.
  • Repayment:
    • 15 years for construction and acquisition
    • 5 years for renovation

How to Apply for IOB Home Loan

The process of application for home loan with IOB needs the download of the form from their portal or collection from the nearest branch. Once the application is submitted to them, they begin the process of evaluation of the proposal. Other processes are vetting deeds, other legal documents and checking up your credit score.

On satisfaction the loan is sanctioned and the process of disbursal commences in alignment with their policies and the terms of the loan chosen.

Housing.com is eminently suited to be your partner in landing an ideal home loan solution matching all your requirements.

Document Checklist for IOB Home Loan

Indicative list of documents required for IOB Home Loan
KYC Documents Valid Identity Proof
Valid proof for DOB
Valid address Proof
Income Proof
  • Salaried: Salary slip
  • Others: ITR or other relevant proof acceptable to them.
Proof of experience Applicable only to professionals and businessmen.
Proof of Membership For Co-op Societies only
Property Documents
  • Approved Plan.
  • Title deed
  • Search for encumbrance for specified period
  • Agreement of sale of property
Estimate Value of the project from their approved Chartered Engineer or Architect.
For NRI All the above documents as stipulated above, plus the specific requirements needed by the bank.

 

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