Mortgage Loan policy | TSCAB
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Loans, Savings

Mortgage Loan policy

Purpose

To provide loans for business, education, medical treatment, trade, construction activity – repairs to immovable property, marriage, personal reasons.

The prospective borrower should be a customer of the Bank with SB or Current A/C in the Branch duly complying with KYC norms.

Area of operation

All the Areas coming under HMDA limits & Nagar Panchayats

Age of building

Not more than 25 years old for Flat/Apartment.

Not more than 35 years old for independent house.

Maximum loan

a) Quantum

b) Computation of Value of House or Flat.

100% of the market value of the House / Flat subject to a maximum of Rs.30.00 lakhs.

The land and building valuation as per market value estimated by empanelled approved valuers.

Eligibility criteria/ EMI Ceiling.

a) Employees

In case the main applicant has no sufficient income to repay the loan, the income of the Co-obligant to the loan will be considered and such Co-obligant must be a blood relation to the applicant.

EMI for the Mortgage loan should be limited in such a way that Total EMIs of any current loans including the requested Mortgage loan should not exceed 66.66% of the net income (i.e atleast 33.33% of Net Income as take home income).

Rental income and agricultural income can be included as declared in I.T. returns. Minimum 3 years of regular service in organizations of good standing as are acceptable to the Bank (as per list approved from time to time), for this purpose.

b) Self Employed/ Professional/ Businessmen

Must be IT assessee.

Left over income after including the proposed loan should be atleast 1/3rd of the gross income as per last 3-years IT returns.

Repayment

On monthly EMI basis

Maximum 10 years or attainment of 65 years of age whichever is earlier.

Rate of interest

Fixed Rate of interest at 12.00% p.a. subject to annual review and revision.

Legal scrutiny

Legal scrutiny will be done by approved Panel Advocates to be decided by the Bank.

Sanctioning Authority:

DGM

Upto Rs.5.00 lakhs

GM(Bkg)

Above Rs.5.00 lakhs to Rs.10.00 lakhs.

SOG

SOG – Above Rs.10.00 lakhs to Rs.30.00 lakhs

Security

Equitable mortgage, at the cost of borrower to be notified to the concerned SRA so that Bank’s claim is reflected in EC.

Insurance

  1. Insurance of building financed for a minimum of 100% for full loan period/amount or for total value of the house whichever is higher against risks like fire, terrorist attacks, earthquake, floods etc.

  2. Life Insurance of the customer equal to loan.

Fee

Processing fee:

1% of the loan amount, subject to a maximum of Rs.10,000/- (+) service tax.

Borrower also to bear cost of stamping on memorandum of deposit of title deeds plus notification charges and E.C. Charges, as per rules in force.

Advocate fee: Rs. 2,500/-

Valuer’s fee: Rs. 2,500/-

Prepayment charges:

No charges for foreclosure and take over.

Others
  1. 2% penal interest on defaulted installments.

  2. Borrower to bear all legal charges, in case of legal action.

PREOCESSING ETC.

Admission of loan applications – Common

The following documents to be furnished along with application at Branch level.

  1. Residence Proof, KYC and Aadhar

  2. Xerox copies of Title Deed and Link documents for 13 years such as vendors sale deed etc.

  3. Original Encumbrance Certificate for the last 13 years.

  4. Original extract from the basic value register of the sub-registrar of assurances indicating the value of site/building/flat.

  5. Building plan approved by the concerned authority i.e., Municipality, etc. (certified copy).

  6. Proof of age certificate for non-employed persons (SSC certificate or Medical certificate (Xerox copy).

  7. Salary certificate and Service Certificate for salaried. Form 16 In Case of Non-Assesse Employees.

  8. 3 years I.T. Returns for self-employed and employees.

  9. Three photos of the applicant.

  10. Rental agreements, if any, for proof of income.

  11. Property tax paid receipt original, where applicable.

  12. Latest statement of Bank account for 6 months.

  13. Collection of processing charges.

  14. Location sketch.

  15. ID proof(copy) – Voter ID/Driving License/Ration Card/ Passport/Pan Card/ID card issued by employer.

In case of salaried class:
  1. Salary slip with details of deductions for the last 3 months.
  2. Service Certificate from the employer including undertaking to deduct and pay monthly installments, from salary, wherever possible.
In case of self-employed class:

a) Balance Sheet and Profit and Loss Accounts of the business/ business address proof copy, profession along with copies of individual income tax returns for the last 3 years, certified by a Chartered Accountant.

b) A note giving information on the nature of business/ profession, form of organisation run by him, original.

c) Copies of Licenses/ Registration Certificate issued by Govt. and other competent authorities to undertake business/practice profession.

Legal Scrutiny

Bank will have panel of Advocates in terms of RBI circular given in this regard. The copies of the documents related to the property being acquired through the loan will be first sent to the Advocate for his legal opinion. CLPC is responsible for SRO search of the documents to decide about the genuineness of the documents.

Physical Verification of Property:

One officer of CLPC will conduct physical verification of the property, purpose of loan, income of the applicant, cross check KYC and SRA search report given by panel advocate and also study the economic viability, and give recommendation.

Share Capital (refundable)

Applicant – Rs.100.00

Co-applicant – Rs.100.00 for each co-applicant

To be collected and nominal membership application taken.

Documentation

i) After sanction of loan by the competent authority, the applicant will be advised to submit original title deed documents to the CLPC.

ii) One designated officer of CLPC will get execution of loan agreement by the applicant,

iii) Ensure insurance coverage of the house for a minimum of 125% of loan amount or value of the house, whichever is higher, and life policy on the life of borrower(s)/ for loan amount duly assigned to the Bank.

Disbursement of loan:
  1. After completion of documentation such as execution of loan agreements, equitable mortgage etc., sanctioning authority will pass orders for release of sanctioned loan amount.

  2. The designated officer of CLPC/Branch Manager concerned will get registered title deeds, ensure deposit of title deeds, notify equitable mortgage to the concerned SRA and take EC with bank’s interest recorded.

Documents to be obtained after release of loan amount:
  1. Registered sale deed, in case the house/flat, executed in party’s favour, along with agreement of depositing of the Title deeds with the Bank, under equitable mortgage.

  2. Insurance policies duly assigned in favour of the Bank.

  3. Notification of Equitable Mortgage and obtain EC with Bank’s interest recorded.

Custody of documents

One of the designated Managers of CLPC and AGM(CLPC) shall keep the documents like Title deeds, Loan agreement, Equitable mortgage papers, ECs, etc., under joint custody.

Review

Aspects like security, possession, latest valuation, repaying capacity etc., shall be reviewed, if necessary.

Recommendations of Credit Rating Agencies:

Approved Credit rating of the proposed Borrower/s as available in the sites of the leading Credit Rating Agencies.

CIBIL score of the Borrower should be recorded and minimum score should be 700. For first time loan takers CIBIL score is not considered.

The Managing Director may relax CIBIL score on case to case basis depending upon merits of the case.