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1 Crore Home Loan: Overview

A 1 crore home loan is a loan of ten million Indian rupees or fifteen lakhs, equating to one hundred and fifty thousand American dollars ($150,000). Generally, home loans are types of loans provided to individuals by banks to pay for the purchase, building or renovation of residential properties.

Features and Benefits of 1 Crore Home Loan

  • The 1 Crore home loans can be transferred from one property or bank to another. 
  • They are loans that make use of EMIs which are often low. 
  • To be eligible for 1 Crore home loans, age and earning capacity are important factors.
  • There are penalties for late payment and in some cases pre-payment penalties for loans paid before due time. 

Advantages of a 1 Crore Home Loan

  • The properties purchased are bound to appreciate over time.
  • In many cases, the loans can be transferred from one lender to another if there is the possibility of more benefits and lower interest rates.
  • The tenor of payment for a 1 crore home loan is usually the longest, thus giving enough time to pay back the loans.
  • In India, there are tax deductions on principal and interests paid on loans. This allows more citizens to become homeowners.
  • The interest rates on a home loan up to 1 crore are usually known to be the smallest because of the long durations, which guarantee a rise and fall in the rate of interest from which one can benefit.
  • It relieves people of the inflation that comes with paying rent.

Eligibility Criteria for a 1 Crore Home Loan

If you want to get a home loan, the eligibility criteria usually depend on whether you are self-employed or a salary earner.

  • The borrowers must be resident citizens of India. 
  • Have a net monthly income of at least 25,000 rupees. 
  • The borrowers must have businesses going on for at least five years, and in the case of salaried individuals, earners must have work experience of three years. 
  • The borrowers are required to be within the ages of at least 25 years to a maximum of 65 years. 
  • The value of the property provided as collateral to the loan should be at least 90% of the loan amount to attain the 1 Crore home loan.

1 Crore Home Loan EMI

EMI, also known as equated monthly instalment, is a fixed amount of money that borrowers are obliged to pay to their lenders on a fixed date every month in a calendar year for a period of time till they complete their loan.

EMIs are affected by varying factors which include but are not limited to: 

  • The principal, which is the exact amount of money to be borrowed.
  • The agreed interest rate by the two parties (that is, the borrower and the lender). 
  • The time frame of loan repayment that the parties have chosen.
  • The type of loan, whether fixed or floating may affect the EMI. Floating loans are loans that have interest rates that can be affected by the level of inflation or not meanwhile fixed loans are loans with interest rates that remain the same throughout the tenor of payment. 

You can calculate your 1 crore home loan EMI using the mathematical formula given below: 

P × r × (1 + r) ^ n / ((1 + r) ^ n – 1), 
where P = Amount of the Loan,
r = Interest rates calculated on a monthly basis, and 
n = Tenor of the loan in months.   

For a more accurate and easier calculation, you can use home loan EMI calculator here.