<p>In a big relief for property buyers, especially those seeking low cost housing, the Reserve Bank of India (RBI) has decided to allow banks to provide home loans for up to 90 per cent value of properties that cost up to Rs 30 lakh.<br /><br /></p>.<p>As per earlier RBI guidelines, home loans for up to 90 per cent of the property value could have been given by banks only for properties of up to Rs 20 lakh. This guideline by the RBI was issued on June 21, 2013.<br /><br />In a circular issued on Thursday, the RBI said that the loan to value (LTV) for individual housing loans of up to Rs 30 lakh shall be up to 90 per cent. For loans above Rs 30 lakh and up to Rs 75 lakh, the LTV ratio shall be up to 80 per cent. As far as loans above Rs 75 lakh are concerned, the LTV ratio shall be a maximum of 75 per cent, the RBI said.<br /><br />The RBI had stated in its monetary policy on September 29 that it is looking at revisiting the risk weights and LTV ratios and that it would be coming out with revised norms soon.<br /><br />The central bank also decided to revise the provisioning or risk weight for loans. As per the new circular, the risk weight for loans of up to Rs 30 lakh, where a buyer avails of loans between 80-90 per cent of the property value shall be 50 per cent, while that for loans where buyer avails of loan up to or equal to 80 per cent shall be 35 per cent.<br /><br />Analysts believe that such a move will be a big boost for banks as they have been striving for capital. The move is likely to further boost the demand for low cost housing across the country which has already been given a leg up thanks to the Housing for All by 2022 scheme announced by Prime Minister Narendra Modi in June 2015.<br /><br /><em>*Earlier, 90% loan was allowed for properties worthRs 20 lakh<br />*For properties up to Rs 75 lakh, 80% loan is allowed<br />*Above Rs 75 lakh, 75% isallowed<br />*Move is likely to further boost the demand for low cost housing </em></p>
<p>In a big relief for property buyers, especially those seeking low cost housing, the Reserve Bank of India (RBI) has decided to allow banks to provide home loans for up to 90 per cent value of properties that cost up to Rs 30 lakh.<br /><br /></p>.<p>As per earlier RBI guidelines, home loans for up to 90 per cent of the property value could have been given by banks only for properties of up to Rs 20 lakh. This guideline by the RBI was issued on June 21, 2013.<br /><br />In a circular issued on Thursday, the RBI said that the loan to value (LTV) for individual housing loans of up to Rs 30 lakh shall be up to 90 per cent. For loans above Rs 30 lakh and up to Rs 75 lakh, the LTV ratio shall be up to 80 per cent. As far as loans above Rs 75 lakh are concerned, the LTV ratio shall be a maximum of 75 per cent, the RBI said.<br /><br />The RBI had stated in its monetary policy on September 29 that it is looking at revisiting the risk weights and LTV ratios and that it would be coming out with revised norms soon.<br /><br />The central bank also decided to revise the provisioning or risk weight for loans. As per the new circular, the risk weight for loans of up to Rs 30 lakh, where a buyer avails of loans between 80-90 per cent of the property value shall be 50 per cent, while that for loans where buyer avails of loan up to or equal to 80 per cent shall be 35 per cent.<br /><br />Analysts believe that such a move will be a big boost for banks as they have been striving for capital. The move is likely to further boost the demand for low cost housing across the country which has already been given a leg up thanks to the Housing for All by 2022 scheme announced by Prime Minister Narendra Modi in June 2015.<br /><br /><em>*Earlier, 90% loan was allowed for properties worthRs 20 lakh<br />*For properties up to Rs 75 lakh, 80% loan is allowed<br />*Above Rs 75 lakh, 75% isallowed<br />*Move is likely to further boost the demand for low cost housing </em></p>