Home Loan FAQs

We offer a variety of home loans you can benefit from:

• New home loan: Loan for purchasing ready built-up or under construction house/flat or resale property.
• Home renovation loan: Loan to redesign your home and giving it a new look.
• Home construction loan: Loan to construct your dream home, on your owned plot.
• Home extension loan: Loan for adding extra space to your existing home, like adding a bedroom, building an extra room, etc.
• Plot loan: Loan for purchasing a piece of land, on which you can construct your dream home.
• Home Loan Transfer: Transfer of an existing home loan at a lower interest, which will help reduce your current interest burden.
• Plot and Construction Loan: Loan to buy a plot of land as well as for constructing your dream home on it
• Pradhan Mantri Awas Yojana (PMAY): Under PMAY, the Government of India aims to fulfil the dream of every first time home buyer in India, by offering him/her an affordable home loan to buy a ‘pucca’ residential house.

EMI (Equated Monthly Installment) is the amount payable to the lending institution every month, till the loan is completely paid off. It comprises of the interest as well as the principal amount.

To qualify for a home loan with DHFL, you must be:

• An Indian resident or Non Resident Indian (NRI)
• Above 21 years of age at the beginning of the loan
• Below 65 years of age, when the loan matures
• Either salaried or self-employed (businessman or professional)

A co-applicant is/are the co-owners of the property which is being offered as collateral/security to the loan. However all co-applicants need not be co-owners. Co-applicants to the loan are generally husband/wife, father/son, etc.

Interest rates vary according to the market conditions and are dynamic in nature. The interest on home loans in India is usually calculated either on monthly reducing or yearly reducing balance. In some cases, daily reducing basis is also adopted.

• Annual Reducing: The principal amount, for which you pay interest, reduces at the end of the year. Thus, you continue to pay interest on a certain portion of the principal which you have actually paid back to the lender. The EMI for the monthly reducing system is effectively less than the annual reducing system.
• Monthly Reducing: The principal amount, for which you pay interest, reduces every month as you pay your EMI.
• Daily Reducing: The principal, for which you pay interest, reduces from the day you pay your EMI. The installments that you pay in the daily reducing system is less than the monthly reducing system

DHFL calculates EMI on monthly reducing basis only.

Fixed rate of interest means interest rate remains constant during the entire tenure of the loan.

In case of floating rate of interest, the interest rate fluctuates based on the Retail Prime lending rate.

Prior to full and final disbursement and at the beginning of the EMI, you pay pre-EMI interest on the portion of the loan disbursed to you. Pre-EMI interest is payable every month from the date of each payment up to the date of commencement of the EMI.

Home loans are usually accompanied by the following costs:

• Processing Charge: It’s a fee payable on applying for a loan.
• Pre-payment Penalties: If the housing loan is under floating interest rate and the loan is prepaid through any source, no prepayment charges shall apply. If the Housing loan is under fixed rate, the pre-payment charges shall apply except in the cases in which the customer is paying out of his ‘Own Sources’. The expression ‘own sources’ indicates that the proceeds of the prepayment should be from ‘any source other than from a bank/HFC/NBFC and/ or a financial institution’. All other Loans would continue to attract pre-payment penalty upon pre-closure, as per the terms and conditions of the loan agreement which is duly signed and executed by the customer.
• Miscellaneous Costs: Other costs as explained during the loan process.

DHFL offers home loans with a tenure ranging up to 30 years.

The property to be purchased itself becomes the security and is mortgaged to the lending institution till the entire loan is repaid. Sometimes additional security such as life insurance policies, FD receipts and share or savings certificates are required.

DHFL doesn’t ask for a Guarantor. One can have a co-applicant instead, while some other financial institutions do ask for guarantors.

Loans can be applied before or after the selection of a property. The loan amounts are sanctioned in principle to let buyers know what amounts they can avail of. This helps them decide their budgets and purchasing power. Actual disbursements are made after satisfactory verification of all necessary documents.

About 3-15 days, subject to proper documentation provided by the home loan applicant.

On an average, loans are given out within 3-15 days after satisfactory, complete documentation and completion of all relevant procedures, including proof that 15% of the cost has been paid upfront to the seller of the property.

Resident Indians are eligible for certain tax benefits on principal and interest components of a home loan. As per Income Tax Act 1961 rules, the current applicable exemption under section 24(b) is Rs. 2,00,000/- for the interest amount paid in the financial year and up to Rs. 1,50,000/- (under section 80 C) for the principal amount repaid in the same year.