Home Loan – Frequently Asked Questions

The process followed for credit approval and sanction after the application form submission is one of the most common home loan queries. Once you apply for a home loan with Bajaj Housing Finance Limited, the application is assessed based on your eligibility. The documents submitted are verified for genuineness and the loan is sanctioned as per the applicant’s financial and credit profile.

Loan approval depend on several essential factors, such as the applicant’s income, repayment capacity, current market value of the residential property to be purchased and provided for mortgage, etc.

Legal representatives from Bajaj Housing Finance Limited also carry out property verification to confirm if it is free from any encumbrance. The property’s evaluation can thus involve site visit and require applicant’s presence to authenticate ownership. Once both eligibility assessment and property evaluation are complete, the housing loan amount is sanctioned to the borrower.

Once the home loan application process is complete, Bajaj Housing Finance Limited proceeds with the application assessment, sanction, and disbursal of the loan amount. Here, applicants must understand that loan sanction and disbursal are two different processes completing the loan availing procedure for them.
The two processes are as follows – 

• Home loan sanctioning

Once you initiate the home purchase or home construction loan process with an application form fill-up and submission, the application is assessed for eligibility fulfilment along with document verification. Based on the applicant’s profile, document suitability, and valuation of house property to be mortgaged, the lender (Bajaj Housing Finance Limited) issues a sanction letter to the applicant. 
The home loan sanction letter is an offer document indicating the suitable loan amount the lender is ready to extend as per the applicant’s eligibility along with other terms of service such as interest rate applicable, tenure for repayment, other home loan charges, etc.
The sanction letter comes with a validity period of 6 months, within which the applicant must confirm the suitability of terms offered, and convey it to BHFL for the loan disbursement process to begin.

• Home loan disbursal

Once the loan amount is sanctioned along with suitable terms agreed to by the applicant, Bajaj Housing Finance Limited proceeds to complete loan disbursal. The amount disbursed is credited directly to the builder or agency involved in selling the house property.
Once disbursed, borrowers need to pay home loan EMIs as specified under the repayment schedule to pay off the loan liability until the agreed tenure.

If you wish to receive the monthly loan statement for housing finance availed from BHFL in your mail box, you would need place a request and/or update your mailing address with us. You may also need to update the address to receive any other service available or to fulfil any lender-specific requirement.
To do so, follow either of the processes mentioned below as applicable in your case.

a. If the mailing address remains the same

Call us on 020 3957 4151 (standard calling charges applicable) or reach out via our Experia app or web portal. You can also connect with us via WhatsApp or by sending an SMS. Visit our Contact Us  page to know more about other assistance options.

b. If the mailing address changes

In case you need assistance with updating a new mailing address different from the one provided when availing the loan with BHFL, visit your nearest Bajaj Housing Finance limited branch to update the details.
Carry along an identity proof to validate your request. We also accept documents of your new residence as a valid proof to update the mailing address.

Email address and mobile number updates are two common home loan queries of borrowers. An existing customer can update the contact details by visiting our Contact Us page and logging in to Experia app or web portal with their customer ID/registered mobile number/email ID and password.

Other alternative options for existing customers to update their contact details include –

• Via call   Call us on 020 3957 4151 (Charges apply) to update your contact details.
• Via SMS  Send an SMS from your registered mobile number with the code UPDEMAIL <new email ID >at 9227564444 to update your email address with Bajaj Housing Finance Limited.
• At our branch  Customers can also visit one of our branches physically with a proof of identity to update their email address and contact number.

When a home loan is approved, the following factors are considered to decide on the EMI amount payable by the borrower every month.
The home loan EMI comprises both principal and interest component of the total loan liability, computed and payable as per the determined repayment schedule. Make sure that you know how to calculate EMI on home loan before applying for the advance for hassle-free EMI payment with minimum strain on your finances.
Bajaj Housing Finance Limited brings Home Loan EMI calculator to make EMI assessment convenient for users. The following values are essential to calculate EMIs payable. Fill in the values in the home loan interest calculator to arrive at an EMI amount suitable as per your repayment capacity.
I.    Home loan amount
II.    Repayment tenure
III.    Interest rate applicable
Once the values are entered, the calculator displays the EMI payable along with the total amount payable by the tenure’s end and the total interest accumulated. Change the loan amount and tenure values to arrive at a home loan EMI amount that suits your income capacity.

Yes, borrowers can request BHFL to increase the EMIs payable for early repayment of the total loan liability. Such an increase leads to tenure reduction, helping borrowers clear their loan liability faster. Back this request with suitable income documents required for home loan to establish your increased capacity of repayment and receive approval.

An increase in EMI thus resets the repayment schedule, also changing the values of principal and interest components of each instalment payable. Make sure to assess your income capacity before requesting for the increase to ensure convenient repayment. Use a home loan EMI calculator to arrive at a suitable EMI amount or connect with a Bajaj Housing Finance Limited representative for queries regarding such an increase.

Alternatively, if funds are available in a lump sum, opt for prepayment of the loan amount to clear off your loan liability before the tenure’s end. Bajaj Housing Finance Limited provides two prepayment options at low to no additional costs to simplify loan repayment for borrowers. They include part-prepayment and foreclosure facilities. These facilities also help you save on the total interest liability as calculated initially.

Yes, with any interest change, the income tax certificate issued to home loan borrowers, better known as the interest certificate, also requires a change. To claim the home loan tax benefits available under the Income Tax Act, 1961, borrowers need to obtain an interest certificate from the lending institution.
The certificate is issued as a proof of interest paid by the borrower within a given financial year, making him/her eligible for deduction of such interest paid towards the loan liability under sections 24B and 80EE of the I-T Act.
As interest accrual and payment are based on the applicable rate of interest decided by the financial institution, any change in interest rate also impacts the interest payment. The values recorded in the income tax certificate thus require a change too for the concerned period. Borrowers can request a new certificate for the said period in case of such interest rate changes or resets.
However, as the housing loan tax benefits are capped, annual interest payment exceeding the following limits with or without rate changes will not impact the certificate value.

• Under section 24B: Up to Rs.2 lakh in case of self-occupied property.
• Under section 80EE: Up to Rs.50,000 for first-time home buyers.

Interest deduction on a home loan availed for residential property purchased and let out u/s 24B is unlimited, thus impacting the interest certificate as per the interest payment made.

Yes, Bajaj Housing Finance Limited allows you to repay your housing loan ahead of the schedule via the following methods. 

a.    Part-prepayment
Customers can pay a part of the outstanding loan liability in a lump sum over and above the EMI amount payable every month to reduce their outstanding liability. Post such payment; opt to repay your home loan at reduced EMIs over the remaining tenure. Or, opt for a tenure reduction if keeping the value of EMIs same as earlier.

b.    Foreclosure
Under the foreclosure facility, borrowers can opt to pay off the total loan outstanding at any time before the tenure ends and close their loan accounts.
Prepayment of a loan helps save on the total interest paid. When availing any of the prepayment facilities on Bajaj Housing Finance Limited Home Loans at floating rates, no additional charges are applicable. Utilise a prepayment calculator to assess your payment affordability and decide accordingly.
Borrowers can also opt for a balance transfer facility to save on their interest outgo. The facility allows transfer of the outstanding loan amount to Bajaj Housing Finance Limited at attractive rates and other terms of service

The applicability of benefits with the introduction of new interest rate regime depends on the benchmarking system followed by your lending institution. Following are the two lending rate benchmarking systems followed for charging interest on home loans and other advances.

a.    MCLR
Marginal Cost of Funds based Lending Rate is an internal lending rate benchmarking system that comes with defined reset periods. It is linked to key policy rates like repo rate, but also derives its applicability from multiple other internal factors such as the marginal cost of funds, negative carry on CRR, tenure premium, and the lender’s operating cost. The financial institution adds a spread to its MCLR to determine the lending rate.

b.    RLLR
RLLR or Repo Linked Lending Rate is an external benchmark lending rate system introduced to bring transparency in interest rate determination for loans and advances. The system of lending is more receptive to any key policy rate changes, ensuring transmission of benefits to the borrower at the earliest.
As per RBI, changes in interest rates for RLLR-based loans must be introduced within 3 months of changes in the repo rate.
Bajaj Housing Finance Limited offers it Home Loans at RLLR based rates that are competitive as well as affordable. Existing borrowers with housing loans at MCLR-based lending can benefit from any rate reductions introduced as per the applicable reset period.

Existing customers of BHFL with a good repayment track record, zero defaults, and sufficient income can avail a Top-up Loan over and above the sanctioned loan amount to fulfil their immediate financing needs.

Bajaj Housing Finance Limited provides the Top-up Loan amount with no restriction to end-use. Customers can thus utilise the loan amount to fulfil their diverse funding needs, such as asset purchase, medical emergencies, consolidation of existing debts, and the likes.

Apply for the loan and receive approval without any additional documents to fulfil your emergency financing needs. A top-up loan also does not require you to meet additional home loan eligibility and needs no separate application. BHFL provides the advance at competitive interest rates to make additional financing affordable for borrowers.

Yes, you can apply for a home loan jointly with your spouse. When applying for a joint home loan, both the co-applicants’ income is considered for the calculation of the loan amount.
Individuals who fall short of a required eligibility can apply for a joint home loan with a co-applicant with the right eligibility, preferably spouse, for easy approval. Joint home loans come with several benefits like 

a. It allows borrowers to avail a higher loan amount with combined eligibility, such as income and credit profile.

b. Co-borrowers of a home loan can also avail separate tax benefits as per their contribution to the repayment amount annually. The extent of deduction applicable is also based on the proportion of property ownership.

c. Joint home loans are also easy to repay as the EMI burden is distributed among the co-borrowers.
Bajaj Housing Finance Limited allows availing a joint Home Loan only with spouse, parent/s, daughter, son, and sibling. Also, the joint housing loan eligibility criteria require applicants to be Indian citizens within the age range of 25 and 62 years.

A. Bajaj Housing Finance Limited follows a strict re-pricing policy to ensure that your home loan remains affordable throughout the tenor. To that end, our home loan interest rates are reviewed every 2 months. Based on the market conditions at the time of reviewing, the rates are either changed, or kept the same and the same is communicated to the customer.

A. A CIBIL score of 750 or higher is ideal when you apply for a home loan.

A. You do not need to have a co-applicant for your home loan if you are registering as the sole owner of the property. However, if the property has a co-owner in addition to you, then the co-owner will have to be a co-applicant on your home loan. Having a co-applicant is ideal for PMAY Loans.

A. You can pay your home loan EMIs online, or offline. These are the two most preferred methods:

• Set up an Electronic Clearing Service (ECS) linked to your bank account. This is a quick, hassle-free, and secure way to pay your home loan EMIs, as the EMI amount gets cut directly from your account and transferred to the Bajaj Housing Finance Limited home loan account. 
• You can also pay your home loan EMIs by sending post-dated cheques in advance, from any bank account registered in your name. This facility is only for customers in locations where the ECS service is not available. The payment can also be done through the Customer Portal.

A. When you foreclose your home loan, a report is sent to CIBIL, noting that the loan is ‘Closed.’ Cibil Score is a function of AI of TransUnion.

A. Generally, the home loan foreclosure statement is generated within 12 days, barring any discrepancies in the documentation. 

A. You can get a Bajaj Housing Finance Limited Home Loan with a tenor of up to 30 years, depending on your repayment capacity.

A. Salaried individuals can apply for a Bajaj Housing Finance Limited Home Loan if they fulfil the following criteria*:

• Must be an Indian resident
• Must be aged between 23 and 62 years
• Must have work experience of at least 3 years

For self-employed individuals, the home loan eligibility criteria are*: 

• Must be an Indian resident
• Must be aged between 25 and 70 years
• Must have at least 5 years of continuity in the current business

*T&C apply

A. You can get significant tax benefits on your home loan, under several sections of the Income Tax Act. They are as follows:

• Under Section 24, you can get a deduction up to Rs.2 lakh on the interest amount repaid in the financial year
• Under Section 80C, you can get a deduction of up to Rs.1.5 lakh on principal amount repaid in the financial year
• Under Section 80C, you can also claim a deduction of up to Rs.1.5 lakh on the registration fees and stamp duty that was paid for the property in that financial year
• Under Section 80EE, you can claim a deduction of up to Rs.50,000 if you are a first-time homebuyer. 
   

A. A top-up loan is a loan that is sanctioned over and above your existing home loan. A top-up loan does not require you to submit additional documentation to the lender. You can use it for any purpose, such as furnishing and decorating your new home, upgrading your car, paying for your child’s higher education, and more.

A. Bajaj Housing Finance Limited presents an online home loan eligibility calculator that instantly lets you know the loan amount you are likely to get. All you need to do is enter the following details:

• Your date of birth
• The city in which the property is located
• Your net monthly income (salary and income from other sources)
• Your desired loan tenor
• Your current financial obligations (EMIs for other loans, for example)

A. If you are an individual borrower with a floating interest rate home loan, the prepayment and foreclosure charges on your loan are nil. On the other hand, if you are an individual borrower with a fixed interest rate home loan, the prepayment charges on your loan are 2% (plus taxes), and the foreclosure charges on your loan are 4% (plus taxes).

A. Bajaj Housing Finance Limited lists all fees and charges on your home loan balance transfer so that you can make an informed decision about your loan. The charges levied are as follows:

• Interest rate
• Processing fee
• Loan statement charges
• Interest and principal statement charges
• EMI bounce charges
• Penal interest
• Secure fee

*The Bajaj Housing Finance Limited Floating Reference Rate for home loans booked before 20 June 2018 was 12.95%.

A. Applying for a Bajaj Housing Finance Home Loan is easy. Just follow these steps:

• Apply online through the application form here.
• Fill in the required details about your income and the property you wish to purchase
• Get your pre-approved offer
• Pay the secure fee online

After this, a relationship manager will contact you and take the process forward.

A. The differences between fixed and floating interest rates on home loans are as follows:

A. If you have made a lodged a service request or complaint with us, and it has not been resolved within 30 days, you can reach out to one of these people and escalate your concern to them:

The term ‘REPO’ denotes repurchase option or agreement.  The Reserve Bank of India (RBI) lends money to commercial financial institutions at this rate, which is subject to changes as per the running policies. With an increase in repo rate, the cost of credit increases for commercial banks, thus making loans expensive for them. It limits their capacity to borrow and also prompts them to increase the rate of interest offered to retail borrowers for various loans and advances and vice versa with the decrease.

*T&C Apply

The final lending rate for various products offered by BHFL will be arrived at after taking into account market reputation, repo rate,  interest, credit and default risk in the related business segment, historical performance of similar homogeneous clients, profile of the borrower, tenure of relationship with the borrower, repayment track record of the borrower in case of existing customer, subventions available, deviations permitted, future potential, group strength, overall customer yield, nature and value of primary and collateral security, etc.

Such information is gathered based on information provided by the borrower, credit reports, market intelligence and information gathered by field inspection of the borrower’s premises. The rate of interest for the same product and tenor availed during same period by different customers need not to be standardized. It could vary for different customers depending upon consideration of any or combination of above factors.

BHFL offers Repo rate linked Interest rate to its customer as per internal underwriting policy (T&C Apply).