HSBC offers easy home loans to both Indian Residents as well as Non-Residential Indians so that they can build a home of their dreams. Currently, the bank offers two kinds of loans with different features and flexible payment options. These can be chosen by the applicant based on their individual requirements. Let’s delve a little deeper to understand what you the applicant stands to gain by applying for an HSBC Home Loan.
HSBC Home Loan Features & benefits
● NRI/New Home Loan
HSBC Bank offers a home loan scheme which is ideal for those who are planning to construct or purchase a home for the first time with a lot of benefits. The loan amount offered under this home loan scheme varies from Rs. 3 lakhs to Rs. 10 crores. A loan can be availed by an applicant as long as the amount falls under the limit set by the bank for a particular home loan scheme. NRIs who do not have any kind of permanent residence in India must have a local co-applicant who can be contacted by the bank as and when the need arises. This loan can be availed for purchasing a property under construction or a ready-to-move property that has been approved by the bank. Applicants can also avail loans for home improvement such as refurnishing or renovation as well.
● Smart Home
Smart Home is a home loan offered by HSBC bank and serves as a Current Account. This permits the borrower to save money while repaying interests on the loans and as well as cut down the loan repayment tenure. A Smart Home Account is offered to the applicants of home loan where the amount is disbursed in the form of an overdraft facility. The applicants can make additional deposits in the account over and above their EMI payments. This amount will be deducted from the outstanding principal amount of the loan. A new interest would then be calculated over the reduced balance. This permits the borrower to save on the interest payments. This loan is available to both Indian residents as well as NRIs as long as they have a local co-applicant.
● Loan Tenure
The home loans can be availed for tenures up to 20 years. Salaried applicants can avail loans for a tenure of up to 25 years.
● Reasonable fees & charges
HSBC charges a processing fee of 1 percent of the loan amount that has been sanctioned OR Rs. 10,000 – whichever is higher. The amount is collected in two parts. One needs to be paid upfront while submitting the application. The second part of processing fee including applicable taxes has to be paid before the loan is disbursed. No pre-payment charges are collected by the bank for a home loan and smart home loans that are disbursed on a floating rate of interest.
● HSBC Home Loan Rate of Interest
Currently, HSBC offers home loans with a floating rate of interest. The interest rate charged by the bank is dependent on the loan amount that you are applying for. The higher the loan amount, the lesser would be the interest charges that you need to pay. The rate of interest is also dependent on the kind of loan that you are opting for.
An interest rate of 8.55% p.a. is charged on home loans for Salaried applicants, and 8.65% p.a. is charged for Self-Employed applicants. For Smart Home loans, the rate of interest is 8.70% p.a. for Salaried; and 8.80% p.a. for self-employed.
For LAP (Loan Against Property) and Smart LAP loans under the home loans category, the rate of interest charged is 9.6% p.a. and 9.9% p.a. respectively. However, the exact rate of interest is dependent on several factors mentioned above. If you opt for Smart Home loans, the amount of interest varies as and when you deposit a lump sum into your Current account and are recalculated.
HSBC Home Loan Eligibility Criteria
In order to qualify for a home loan from HSBC bank, there are certain criteria that must be fulfilled by the applicant.
For Salaried Applicants:
✔ Minimum Net Income must be Rs. 5 lakhs or above
✔ Maximum Age of Loan maturity must be 58 (it’s 60 in case of Public Limited/Govt. employees)
For Self-Employed individuals:
✔ Minimum Net Income must be Rs. 7.5 lakhs or above
✔ Maximum Age of Loan maturity must be 65
All the applicants must be of 21 years of age or above. The minimum loan amount offered by the bank is Rs. 3 lacs and the maximum amount offered is Rs. 10 crores. The applicants need to ensure their property from an insurance company against loss by floods, earthquake, fire and other damages. There is also a condition that HSBC bank must be added as a beneficiary while applying for insurance.
HSBC Home Loan Charges & Documents
HSBC bank does not have any prepayment charges on the home loans, provided the loan is under a floating rate of interest. However, in case of a fixed rate of interest home loan, there is a charge of 3% of Prepayment amount only when the amount is more than 25% of the sanctioned loan amount in each financial year. There is also a processing fee charged of 1% of the loan amount that has been sanctioned.
Documents required for Indian Residents
The completed application form needs to be submitted with a passport-size photograph. All the documents have to be self-attested before submission. The applicants need to submit Proof of Identity, Proof of Residence, Proof of Age and Financial Documents that verify the income of the individuals.
Salaried applicants have to submit salary slips of three months that clearly specify the statutory deductions. Bank statements also need to be produced which show three salary credits. Self-employed applicants need to submit IT returns for the last two years. Balance sheet that has been certified by an auditor or CA also needs to be submitted along with Primary bank account statement for the last six months. A Partnership deed has to be submitted by the partner/s of a firm and shareholding patterns must be submitted by the directors of private companies.
Documents to be submitted by NRIs
Salaried applicants need to produce a copy of a valid Indian passport with visa stamps. A copy of the work permit or any other equivalent document also needs to be submitted. Latest contract copy including wage slips or salary certificate should be submitted. Overseas bank statements for the past three months also have to be submitted as proof to the bank. Self-employed NRIs have to produce a copy of trade license, six months’ overseas bank account statements, the balance sheet for last three years that have been certified by a CA along with a copy of passport with a valid VISA stamp.