Points to remember before going for the plot loan
It’s not worth playing around with bank and playing tricks as it will mostly waste your time and you won’t gain much in case you don’t want to build the house. Make sure you take these plot loans only in case you are interested in building the house. You can also ask the bank to first disburse only the loan amount for the plot and later release more amount at the time of house construction.
Most important points
- Generally, banks calculate plot value based on the sale deed value, most of the cases sale deed value is lesser than the market value. Also, as mentioned above, banks like SBI will only consider sale deed value but some private banks might also look at market value in that area and which will be derived through their certified valuers. SBI will give a loan on plot purchase.
- There is no clarity even with bankers about what happens if you sell the plot within a year or two without construction, most of the representatives told me that it will be like closing a home loans but I guess that’s a false statement and depends on the bank and agreement if mentioned specifically in it.
- The total loan again depends on the construction value in that area. Then based on the theft you are planning to construct the total loan amount will be derived. Let me put it in numbers:
- Plot Area: 300 square yards. – SBI bank loan – Sale deed value is 10000 – 30 lacs. For plot purchase – 60% of 30lacs will be given to you as a loan. 18lacs loan will be provided by the bank, this is given as cheque payment directly to the seller. For the construction of the house, they will provide it based on the permission you got.
- In total, you can get a 63lacs (18+45) loan, provided you are eligible for such a loan based on your income.
- To prevent malpractices, in the case of a home loan, the bank keeps the sale deed of the plot. With documents not available, one cannot legally sell the plot. There can be a word of mouth agreement whereby the buyer can give money to the seller to release the loan and documents and then purchase.