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    • Home Loan for Under Construction Properties

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    Home loans for under-construction properties can help you complete the construction of your residential property without any hassles or delays. You can avail a housing loan for your property whether it is being constructed independently by a contractor hired by you or by a reputed builder. It is usually disbursed in multiple tranches according to the stage of construction. Some financial institutions only charge interest on the amount already disbursed, which results in lower Equated Monthly Instalments (EMIs).

    Features and Benefits of Home Loans for Under-Construction Properties

    There are several benefits and features of home loans for properties that are being constructed from scratch. These are as given below:

    • Lower EMIs: Under-construction home loans are sometimes disbursed in installments according to the requirements of the stage of construction, with interest being charged only on the amount that is disbursed, leading to lower EMIs
    • Flexible repayment tenures: While this can vary from bank to bank, repayment tenures can go up to 30 years depending on the age of the borrower at the time of availing the loan
    • Attractive interest rates: You can get attractive interest rates on home loans that can be even more affordable if you have a good credit score
    • Interest payments: Until you get possession of your house, you only have to pay the interest component of your housing loan, which is termed the PPI-Prior Period Interest.
    • Tax Benefits: Tax benefits on a home loan for under construction properties can be availed for up to Rs.2 lakh for the interest component and up to Rs.1.5 lakh of the principal component of the home loan after receipt of the Occupancy Certificate from the builder.

    Best Home Loans for Properties under Construction

    Home Loans for Under Construction Properties Best for
    Bank of Baroda Home Loan Home Buyers in Rural Areas
    SBI Regular Home Loan Special Rates for Women
    PNB Housing Loan Approved Projects
    Canara bank home loan Longer Repayment
    LIC Home Loan Late Possession
    1. Bank of Baroda Home Loan

      Bank of Baroda home loan schemes for construction of a house can be availed for up to Rs.1 crore in rural and semi-urban areas and up to Rs.10 crore in metros. The highlights of the scheme are:

      • Reimbursement of the cost of plot of land (if purchased within 2 years)
      • Maximum tenure of up to 30 years with moratorium period of up to 3 years after disbursal of loan
      • Top-up loan can be availed for up to 5 times during the loan tenure

      Explore: Bank of Baroda Home Loan

    2. SBI Regular Home Loan

      State Bank of India’s Regular Home Loan can be used to purchase property under construction. It is widely available across India and has transparent processes. The highlights of the scheme are:

      • Low interest rates
      • Special concession on interest for women borrowers
      • Repayment tenure of up to 30 years

      Explore: SBI home Loan

    3. Punjab National Bank Housing Loan for Public

      Punjab National Bank Housing Loan for Public can be used to purchase houses or flats that are under construction by approved builders and developers. The highlights of the housing loan are:

      • Quantum of loan of up to Rs.50 lakh
      • Maximum tenure of up to 30 years
      • Attractive interest rates and low processing fees

      Explore: PNB Housing Finance

    4. Canara Bank Housing Loan

      Canara Bank Housing Loan is convenient both for purchasing an under-construction property and to take over an existing loan from other financial institutions. The highlights of this home loan are as follows:

      • Repayment tenure of up to 30 years or borrower attaining 75 years of age
      • Loan amount of up to 4 times the gross annual salary or gross annual income
      • Attractive rates of interest with interest rate concessions for women based on credit risk premium

      Explore: Canarabank Home Loan

    5. LIC Housing Finance Pay When You Stay Housing Loan Scheme

      LIC Housing Finance Pay When You Stay loan scheme offers a special feature where repayment of the principal amount of the loan starts only when you have possession of the property. Other highlights of the scheme are:

      • Maximum loan amount of up to Rs.2 crore with loan beyond this also offered under a separate loan account
      • Repayment tenure of up to 30 years
      • Pradhan Mantri Awas Yojana Credit Linked Subsidy Scheme can also be availed under this by eligible individuals

      Explore: LIC Home Loan

    Verdict

    The home loans for under-construction properties offered by banks and other financial institutions make it possible to construct your dream home the way you wish. The affordable interest rates and long repayment tenures help to make it easier and more convenient than ever to own your own home.

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