Canara Bank Home Loan
Home Loan Bank Information
Table of Contents
- Canara Bank Home Loan Features
- Canara Bank Home Loan Interest Rates
- Eligibility Criteria for Canara Bank Home Loan
- Canara Bank Home Loan Types
- Canara Bank Home Loan for NRIs
- How to Apply for Canara Bank Home Loan
- Document Checklist for Canara Bank Home Loan
Introduction
Canara Bank provides home loans at affordable prices with competitive interest rates and minimal documentation.
From purchasing a ready to move in house to constructing a house to constructing and undertaking the repair, renovation and expansion of your house, all of this can be easily covered with the help of a home loan. You can also take a loan for acquiring a second property.
The bank also promises to quickly process the loan so that the customer doesn’t have to face any problem.
With over 6000 branches all across the world, Canara Bank is popular for its customer-centric approach.
Canara bank home loan comes with an interest rate ranging from 8.35 % to 8.55 %. It also charges a minimal processing fee of 0.5 % on the loan amount of at least Rs.10000. You can take a loan for up to 30 years. The bank doesn’t ask for a guarantor, nor does it levy pre-closure charges.
According to the Income Tax Act of 1961, residents of India can enjoy several tax benefits on principal amount and interest of a housing loan under section 24 and section 80C of the Income Tax Act.
There are different types of home loans offered by Canara Bank and their interest rates also vary accordingly. These are:
- Housing Loan
- Housing Loan CRE
- Home Improvement Loan
- Canara Home Loan Plus
Canara Bank Home Loan Features
- You can take a loan to buy, construct a new home or renovate your existing home.
- Both salaried, as well as self-employed people, are eligible to take the loan.
- The bank offers special interest rates to women borrowers.
- Any person within the age group of 21 and 55 years can take a loan.
- The home loans provided by Canara Bank has a loan to value ratio of 80%.
- The period of the loan ranges from 5 to 30 years.
- The bank provides Profitable interest rates ranging from 8.75% to 8.95%.
- You will get the lowest EMI of Rs. 787 per lakh.
Canara Bank offers special schemes and personalised home loan interest rates special category of borrowers like women, senior citizens, NRIs, among others.
The special schemes include:
- Yuva Awas Rin
- Canara Home Loan Plus
- Canara Site Loan
Canara Bank Home Loan Interest Rates
Note: The interest rates are as of 2019
The interest rate that is levied upon different types of home loans depends upon two major factors:
Borrower’s Salary: The annual income of borrower plays a vital role in determining the interest rate that he/she will have to incur. These are inversely proportional to each other, which means higher is the Income, lower is the interest rate that the applicant has to pay.
Amount of the Loan: The interest rate also majorly depends on loan amount availed. If loan amount is higher, the interest rate will also become higher as well.
| Scheme Name | Loan Amount | Interest rate for women borrowers | Interest rate for other borrowers |
|---|---|---|---|
| Housing loan, Yuvaawasrin Housing loan to senior citizens, Housing loan to NRIs | Upto Rs 30 lakh | 8.55 % | 8.60 % |
| More than Rs 30 lakh | 8.65 % | 8.70 % | |
| Home loan – CRE | Upto Rs 30 lakh | 9.05 % | 9.10 % |
| More than Rs 30 lakh to Rs 75 lakh | 9.15 % | 9.20 % | |
| More than Rs 75 lakh | 9.20 % | 9.25 % | |
| Home Improvement loan | 1 Year MCLR + 2.45 % | 10.95 % |
Once your purpose of taking a loan is solved, you can conveniently pay off your debt in monthly instalments for up to 30 years or till the time the borrower has attained an 70 years of age, whichever is earlier.
If you have purchased a loan for ready built house/flat, you will start repaying the loan amount within two months from the date of the first disbursement.
In the case of purchasing a site and constructing the house after that or constructing a house on the already existing plot, you need to repay the loan amount within 2 months after completion of the house or 24 months from the date of the first disbursement..
In the case of purchase of flat, which is under construction, you need to start repaying your loan within 2 months of completion of the construction work or 36 months from the date of the first disbursement, whichever is earlier.
Apart from interest rates, Canara Bank also levies other miscellaneous charges that are:
Processing Fee – Canara Bank charges 0. 50 % processing fees for the expenses spent for finishing the lending procedure.
Legal and Technical Charges – Canara Bank also levies legal and technical charges that are told to the customers at the time of the loan process. After you go through the process of the loan, you are required to pay the charges as per Canara Bank’s rules and regulations
Prepayment Charge: When the borrower wishes to transfer the home loan to another financial provider, the borrower is expected to give an application for the transfer to Canara Bank. According to the rules of the RBI, financial providers should not charge prepayment penalty on home loans availed under a floating rate. Therefore, the borrower can prepay the home loan at Canara Bank without paying any charges.
Eligibility Criteria for Canara Bank Home Loan
Canara Bank has very clearly specified the eligibility criteria of people willing to borrow a housing loan. This includes:
- Salaried professionals who have been in service for a minimum of three years are eligible for a home loan.
- Businesspeople or self-employed people who have been running their business for a minimum of 3 years are eligible for a housing loan.
- Any person who is interested in taking a housing loan should be less than 60 years of age at the time of availing it.
- People above 60 years can take a home loan but only after agreeing to certain conditions.
The table given below will help you understand it more clearly:
| CATEGORY | CRITERIA |
|---|---|
| Age | 21 years to 60 years |
| Work experience of salaried people | 3 years |
| Work experience of self-employed | 3 years |
| Nationality | Indian citizen |
| Co – applicants | Close relatives or Spouse |
| NRI Status | 3 years |
Salaried individuals are eligible for a loan amount of 4 times their gross salary; however, self-employed individuals can borrow a loan of upto 4 times their annual income. In rare cases, this quantum can be increased on the bank’s discretion.
Canara Bank offers a maximum amount of Rs 15 lakh to repair and renovate a house. The mortgage of property will be considered as security to the loan.
If you wish to increase your eligibility of borrowing a housing loan, you can make your spouse or family member the co –a pplicant for your loan, only if they are earning well. The combination of both the income will help you in increasing your eligibility to get a loan.
However, there are specific restrictions on the choice of your co – applicant.
Spouse: Your legally-wedded spouse is the best co-applicant for your home loan. If he or she is an earning well, it can work in your favour in a big way.
Parents: Parents can become a co-applicant in housing loan under the following conditions:
- Parent-Son: This is the most favoured combination of co-applicants. Banks allow this combination; however, you need to keep in mind the age of parent involved as it might affect the tenure of your housing loan. You might end up with a shorter period.
- Parent-Daughter: Daughters, who are married, cannot have their parents as co-applicants in housing loan. They can only do so if they are co-owners of the property. Daughters, who are not married, can take their parents as co-applicants on housing loan only if the property is not in the name of the parent.
Siblings: Banks often hesitate to make siblings as co-applicants as there are chances of an individual sibling backing off in a bid to purchase their own house subsequently. If the siblings jointly own the property, they have to be the co-applicants. However, the brother-sister combination is not acceptable to banks because of obvious reasons.
To check if you are eligible to take a home loan or not, Canara Bank will divulge into your entire CIBIL report, which also involves knowing about your previous running loans and payment track record on those loans as well as credit cards.
If your credit score turns out to be high, there are higher chances that your loan application will get approved from Canara Bank. But if your CIBIL score is low, it will lower your eligibility to get a housing loan. An applicant requires a minimum credit score of 650 to be eligible for a home loan by Canara Bank.
Canara Bank Home Loan Types
Canara Bank provides different types of home loans. These include:
Reverse Mortgage Loan or Senior Citizen Home Loan Scheme
As the senior citizens come close to their retirement age, their biggest worry of leading a peaceful life, without any monetary issues, keeps hogging them. Canara Jeevan or Reverse Mortgage loan offered by Canara Bank promises to help them lead a carefree life.
The main purpose of the Reverse Mortgage Loan is to help fulfil the financial needs of older people with self-occupied property. It helps the senior citizens to convert their residential property into liquid cash flows to meet their financial expenses.
Objectives of Senior citizen home loan scheme:
- It acts as a supplement for pension and other sources of income.
- It helps in the maintenance of the family and covers medical, emergency expenses that might come unannounced.
- This loan can also help in paying off an existing loan taken for the residential property to be mortgaged.
- If you plan to upgrade, renovate or extend your residential property, this loan can help you deal with those expenses without any hassle.
- You can also take this loan for home improvement or insurance of residential property or covering up any other genuine need.
Eligibility criteria for Senior Citizen home loan scheme
- Legal owners of a residential house, who are 60 years and above, and are permanent Indian residents.
- They should have self-acquired or self-occupied property as a permanent resident. The property should not have any liability.
- The life of the property should be at least 20 years. However, for flats, it should not be more than 10 years.
- Commercial property does not come under this scheme.
- The loan cannot be taken against the ancestral property.
If a couple wishes to be a joint borrower of the loan, so for that at least one spouse should be above 60 years, and the other one should be more than 55 years of age.
If the couple jointly owns the property, then the joint owner, who is above 60 years, will be the primary borrower.
The interest rate on the Senior Citizen home loan scheme varies from 8.65 % to 8.85 %.
Quantum of loan
If Senior citizens are the owner of an independent house, the minimum loan amount is Rs.5 lakh, and the maximum is Rs.50 lakh.
If senior citizens are the owner of a flat, then, in that case, minimum loan quantum is Rs.5 lakh, and the maximum is Rs.25 lakh. The loan period is not more than 15 years in both the cases or till the death of the last surviving spouse.
The bank charges a processing fee of 0.25 % of the loan amount with a maximum of Rs. 5000.
Canara Bank Home Loan Plus
Canara Bank Home Loan Plus is a loan scheme is available for Canara Bank’s existing home loan customers with a good repayment record for a minimum of 1 year.
Eligibility criteria
Any person between 18 to 65 years of age is eligible for this kind of loan. You can borrow it either through overdraft facility or loan facility.
Amount of Loan
The maximum quantum for both, loans and overdraft facility shall be decided in a way that combines the liability of borrower under Housing Loan as well as proposed loan, which should not be more than 75% property’s value.
| Category | Loan Amount |
|---|---|
| In case of Salaried applicants | 10 months of gross salary; maximum Rs. 25 lakh |
| In case of Non – salaried applicants | 75% of 3 years average gross income; maximum Rs. 25 lakh |
The salaried individuals also have to keep in mind that the take – home salary should not be less than 40%, after subtracting the EMIs towards Housing Loan & Canara Home Loan Plus. The period for repayment is 120 EMIs or remaining period of the existing home loan, which ever is less.
Canara bank will charge processing fees of 0.50% of the loan amount, which is a minimum of Rs.100 and a maximum of Rs 500.
The interest rate on Canara Bank Home Loan Plus
| Type of Home Plus loan | Interest Rates | Present Interest |
|---|---|---|
| Term Loan | One Year MCLR + 0.50% | 9 % |
| Overdraft | One Year MCLR + 1.00% | 9.50% |
Home Improvement Loan Scheme
The Canara Bank Home Improvement Loan Scheme promises to offer financial assistance to people who plan to furnish their houses/flats, that too, at lowest rates of interest.
With this loan, you can buy household furniture items, refrigerator, fans, air conditioners, wardrobes and any other essential household items.
Eligibility criteria
- Homeowners and salaried individuals, who have a take – home salary of minimum 25% monthly of their gross salary after deducting the loan instalment.
- Homeowners and non-salaried persons with a annual income minimum of Rs. 50000, that should be supported by Income Tax Return.
Loan Amount
The maximum quantum of the loan is Rs.2 lakh; however, higher quantum will be considered selectively. The maximum period for repayment of the loan will be 60 EMIs.
Interest rate on Home Improvement Loan
| Category | Interest Rate | Present interest |
|---|---|---|
| Home Improvement | One Year MCLR + 2.45 % | 10.95 % |
Canara Bank Site Loans
Canara Bank’s Site Loan caters to the individuals, who are willing to buy plots from the State Development Board, or other such local authorities.
This scheme can also be availed if the plots are being bought in joint action with private entities, or any other entity created by the Government for distribution of sites, provided that the layouts are officially approved by the concerned authority.
Eligibility criteria
- Customers who have had a good track record with the bank are eligible to apply for Site Loan. However, that doesn’t mean new people can’t apply.
- Any person who is less than 60 years of age can ask for site loan.
- NRIs also have the opportunity to apply for this type of loan.
Loan Amount
Maximum loan amount that can be borrowed would be 4 years of the gross annual salary or income of the applicant or 75.00 % of the value of the site, whichever is less.
Interest rate of Canara Site Loan
| Category | Interest Rate | Present interest rate |
|---|---|---|
| Canara Site Loan | One Year MCLR + 1.00 % | 9.50 % |
YuwaAwas Rin
This home loan offer is exclusively for earning youngsters between the age group of 21 years to 45 years, who would like to purchase a flat, house or even construct a flat or a house.
If you wish to renovate your house, Yuwa Awas Rin Scheme will help you do so. You can even borrow the loan to buy a second flat or house. However, the bank will charge a nominal processing fee of @ 0.5 % of sanctioned amount with a minimum of Rs. 1500 including taxes and maximum of Rs 10,000.
Eligibility criteria
- Any youngster between the age of 21 to 45 years.
- Any youngster within the age group mentioned above, who has been in confirmed service for a minimum of 2 years in central govt, state govt, reputed PSUs, joint-stock companies, reputed corporate, public limited companies, private institutions, IT companies or BT Companies, is eligible to take a loan.
- Those working as Lecturers, Asst Professors and Professors in colleges, research institutes and universities can also apply for the loan.
Loan Amount
The maximum amount that can be borrowed would be 6 years gross salary as per latest Income Tax Assessment Order/acknowledgement of ITR / Form 16 etc.
Another factor that needs to be kept in mind is that the minimum net take-home salary of the applicant after deducting the proposed EMI shouldn’t be lower than 30 % or a minimum of Rs. 10,000.
Interest rate of YuwaAwas Rin
| Loan Amount | Women borrowers | Other borrowers |
|---|---|---|
| Upto INR 30 lakh | 8.55 % | 8.60 % |
| More than INR 30 lakh-INR 75 lakh | 8.65 % | 8.70 % |
| More than 75 lakh | 8.70 % | 8.75 % |
The loan can be paid off before 30 years or until the borrower reaches 70 years of age,. You would also require a guarantee of the third party to borrow the loan amount.
Canara Bank Home Loan for NRIs
Canara bank offers NRI Home Loan at affordable rates for the Indians who are staying abroad and plan to purchase a house in India. Such people can ask for a home loan easily at attractive interest rates along with nominal processing fees of up to 0.10% of the loan amount.
However, there are no hidden charges in the loan and margin for the customer is also less.
NRIs can apply for a housing loan through the convenience of online banking, where the customers who wish to track or check current loan application status can do so by just filling up the application number and registered mobile number.
Eligibility criteria
- Non-resident Indians (NRIs) holding a valid Indian passport or any person of Indian origin (PIO) with a legal foreign passport can avail the benefits of NRI home loans.
- The applicant has to be minimum 21 years, maximum should be 60 years.
- Spouses or blood relatives of NRIs can also jointly apply for the home loan.
- It is important for the applicant to have a source of income and should have worked abroad for on a job contract or a valid work permit or at least 2 years.
- It is also mandatory for the borrower to be an NRI for the last 3 consecutive years.
- Non-residential borrowers have the freedom to assign a Power of Attorney to any resident Indian.
- The applicant is required to deposit an equitable mortgage through registered mortgage or title deeds as applicable.
- The loan can be paid off by the borrower in a maximum of 30 years or before he attains 60 years of age.
- NRI customer can pay off the loan in the form of EMIs with the help of normal banking channels, through Remittances from abroad or can transfer of funds from NRE / FCNR account from close relatives.
Loan Amount
The maximum amount f loan that the applicant can borrow is 4 times the gross annual income with a net take – home of 40 % after considering the proposed EMI.
A higher loan quantum of upto5 years of the gross annual salary or income can also be borrowed, but it is subject to certain terms and conditions.
A margin of 25 % (Up to Rs.15.00 lakh) will be applicable if an applicant is applying a loan for repair and renovation.
Interest rate
The Interest rate of home loans starts from 8.85 % for NRI applicants
Documents needed for NRI home loan scheme
- Loan Application with 2 photographs (passport size)
- Proof of Identity – Copy of first four pages of passport and page with visa stamp or IC or PIO card.
- Valid work permit.
- A Copy of Last Salary Certificate or slip in the original and the employment contract..
- A copy of the applicant’s salary certificate attested by Indian Consulate or Embassy or Employer.
- A copy of proof of income for self-employed professionals or businesspeople and identity card issued by the current employer
- Brief Profile of the applicant and work establishment.
- Details of previous employment.
- Bank account statement/passbook for the last six months.
- Account statement/passbook of the overseas bank showing salary and savings.
- Proof of residence (driving licence or utility bills)
- Copy of Continuous Discharge Certificate (CDC) – for applicants employment in the merchant navy.
- Sale Deed or Sale Agreement
- Copy of the building plan/approvals in respect of proposed construction or purchase or extension.
- Original NOC under the Provisions of ULC Act.
- Detailed cost estimate/valuation report from Bank’s Panel Architect or Chartered Engineer
- Allotment letter of Apartment Owners’ Association or NOC from Society or Housing Board or Housing Board or Association / Builders.
- EC for the last 13 years, Legal Scrutiny Report, Khata, Property Tax receipt, and permission for a mortgage, wherever necessary
- An explanation note about the kind of business, year of establishment, type of organisation, etc., ( for self – employed)
- P&L Account and Balance Sheet for the last 3 years (in the case of self – employed)
Given below is the table are the things that need to be considered before proceeding with the processing of a loan.
| Work Experience | At least 2 yrs consecutively in the same company |
|---|---|
| Age criteria | 21 – 60 years |
| Loan period | Up to 30 years or the borrower reaching the age of 60, whichever is earlier |
| Loan Amount | 4 times of annual income with a 40 % take – home after taking the proposed EMI into consideration. |
| Interest rate | 8.50 % to 8.85 % |
| Processing fees | 0.10% |
| Prepayment fees | N/A |
| Nationality | Indian |
How to Apply for Canara Bank Home Loan
Any borrower willing to apply for a home loan from Canara Bank can do so by either visiting their official website or by visiting the branch personally.
You have to fill up the application form. When the application form for the home loan is completed, submit it online, the bank will start processing your loan.
The bank will then check your CIBIL score, creditworthiness, repayment ability, etc. and if everything works out well, then the Canara bank will disburse the home loan.
You will get all the information on the amount of Equated Monthly Installments you have to pay as well as the what interest rate. You will also be intimated about a nominal processing fee that you will be costed for processing the loan.
Document Checklist for Canara Bank Home Loan
Here’s a list of common documents needed for a housing loan application:
Filled in application form of the Home Loan
Photographs (Passport size)
Identification Proof (Any one)
- Voter’s ID Card
- PAN Card
- Passport
- Aadhaar Card
- Driving License
Age Proof (Any one)
- Aadhaar Card
- Passport
- Driving License
- PAN Card
- Birth Certificate
- Bank Passbook
- 10th Mark sheet
Residence Proof (Any one)
- Bank Passbook
- Ration Card
- Voter’s ID
- Passport
- LIC Policy Receipt
- Utility bills: Telephone, Electricity, Water, Gas, etc.
- A Letter verifying the customer’s address from a recognised public authority
Income Proofs
For Salaried Applicants:
- Form 16
- Letter from the employer
- Latest 2 months payslip
- Promotion or Increment letter
- Past 3 years IT returns
- In addition to the proof of income, the borrower also submit an investment proof like shares, fixed deposits, etc. along with photographs (passport – size).
For Self – Employed Applicants
- Last 3 years IT returns
- Proof of Business Address
- Profit & Loss Account Statement and Balance Sheet and of the Firm / Company (attested by a CA.)
- License of Professional Practice (in the case of Consultants, Doctors, etc.)
- Business License Details (or any other equivalent document)
- For Factories, Shops, & Other such establishments the Registration Certificate of Establishment must be provided.
Property Documents
- NOC from Builder / Society
- Original Documents of Allotment Letter, Registered Sale Deed, or Stamped Agreement of Sale made with the proposed builder.
- A detailed estimate of the cost of construction of the house
- Maintenance Bills, Property Tax Receipts, and Electricity Bills
- An approved copy of the building plan (key plan/floor plan in case of purchase of flats)
- Occupancy Certificate (in case of ready-to-move-in properties)
- Receipts of the advance payments made towards the purchase of flat (original document)
- Bank account statements or payment receipt showing payments made to the seller or builder.
- Possession certificate and land tax paid receipt and Original issued by the revenue authority.