Know all the nitty-gritties of NRI Home Loans

For every person living away from their home country, owning a property of their own in India is like setting roots in your country. But a lot of times what keeps them from doing so is the hassle of applying and getting an NRI home loan.

Earlier, applying for an NRI home loan used to be a long process and the applicant would have had to spend a lot of time to ensure that all the documents and procedures took place in the stipulated time.  But times have changed and now it is easier than ever for NRIs to get home loans in India.

If you’re seeking to get an NRI home loan and need to know all the nitty-gritties of the process, here are some important things about NRI home loans that you should know:

  1. The RBI defines NRI as a person resident outside India who is citizen of India. In terms of Regulation 2 of FEMA Notification No.13 dated May 3, 2000, Non-Resident Indian (NRI) means a person resident outside India who is a citizen of India. Person of Indian Origin (PIO) means a citizen of any country other than Bangladesh or Pakistan who had (a) at any time held Indian passport or (b) he or either of his parents or any of his grandparents was a citizen of India by virtue of the Constitution of India or the Citizenship Act, 1955 or (c) the person is a spouse of an Indian citizen or a person referred to in (a) or (b). The amount that is sanctioned to you as a loan will depend on your educational qualifications and overall income. Normally a loan is sanctioned for 80% to 85% but the amount sanctioned will be decided on the basis of your monthly income.
  2. The home loan interest rate in India for NRIs is normally higher than the interest rate thatis offered to  This is due to the increase in risk factors. Normally, the difference ranges from 0.25 to 0.5%.
  3. The documents required for an NRI home loan are largely similar to the ones required for any other loan. An NRI will additionally require his/her passport, visa, work permit, employment proof etc.
  4. All payments towards this loan need to be done in the Indian rupee (INR) and not the currency of the NRI’s current residence.

There are a few prerequisites that the NRI should meet in order to be eligible for an NRI home loan. Here’s what they are:

  1. The person applying for an NRI home loan should have worked in a foreign country for over a year.
  2. In the case of self-employed people or businessmen, this requirement is extended to three years. The rules for self-employed NRIs are slightly stricter than those for salaried NRIs. It is, therefore, a bit easier for a salaried person to get an NRI home loan, than it would be for a small business owner.
  3. The minimum income for the applicant to be eligible for an NRI home loan is different for different banks but on an average, one must have an income of 30,000 USD or 35,000 DHM (for people residing in the UAE).

If you meet all these criteria and really want to own your own property in India, then there’s very little that can stop you from getting an NRI home loan. Know your monthly expenses on loans by using our Home Loan EMI calculator.

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