4 Myths Of The Nri Loan

By Author: Neha Sharma
Total Articles: 108

Most NRI’s who have traveled abroad normally invest in many options where they need to avail an NRI loan. However, there are certain myths that surround the application and availability of these loans. In this article, we give you the common myths of loans for NRI’s.

Myth 1: Family Relation Only
It is a common knowledge that those who are applying for the power of attorney canonly be blood relatives of the primary holder. While this is practiced in most of the banks, certain selected banks however do not follow this policy. NRI’s can select certain members from outside the family like trusted friends and associates that can be selected as the power of attorney. These individuals can also be joint holders for NRI home loan too as long as they are satisfying the other mandatory requirements.

Myth 2: Restricted Application for NRI Home Loan
It is myth that certain individuals cannot apply for an NRI Loan. Certain individuals like OCI, PIO and NRI’s from certain countries are supposedly not allowed to apply for these loans. However this is not true. These individuals have the same rights as any other NRI to apply for these loans. All they have to do is submit the necessary documents like the PIO card, work permits, proofs of identity, mailing address, proof of visa and proof of valid passport with expiry date. To apply for this loan, they should approach a bank that has a branch in the country of origin as well as the country abroad.

Myth 3: Co – Applicant for Home Loan
When applying for a local home loan, an NRI and an Indian resident can jointly apply for this loan, but it would still be given a status of an NRI Loan. Although the assets are jointly owned by both individuals, the primary applicant will be given to the individual who holds the NRI status. This will impact the eligibility of the loan as factors of the NRI individual’s income and status will be taken into account. The loan process will be undertaken through the NRI’s account where standing instructions will be issued through this account.

Myth 4: Repayment for the Loan
The EMI payments for the NRI home loan will be made through the individual with the NRI status through his NRE account or NRO account jointly with the resident Indian. Standing instructions and cheques can be issued through this account. The tenure and the rate of the interest determined will be same for both the nominees. In the occasion that the status of the NRI individual turns to local when he returns back to the home country, the details of the loan will be revised where the interest rate and tenure will be revised to suit the needs of the account holders.

Author Bio :- Neha Sharma is a finance student who loves to write about NRI Loans. It comes as no surprise that she wishes to share relevant information about NRI home loans to those who are interested in it.