In 2024, are you planning to purchase a site in Hyderabad? However, you are aware of its cost, aren’t you? Several banks and housing finance companies (HFCs) offer plot loans, so don’t worry about the cost. Making an informed choice can be challenging with many options available, but we’ve got you covered here. We’ll talk about the best Indian banks for plot loans in 2024 in this column. Please sit back and continue reading to learn which bank can assist you in realizing your dream of owning a plot in India.
What is a plot loan?
Let’s start by defining a plot loan before delving into the top banks in India in 2024. Banks and Housing Finance Companies (HFCs) typically provide plot loans or land loans to individuals who want to buy a piece of land and develop their ideal residential or commercial property without having to pay the whole sum upfront. It is easier for people to manage their money because the loan amount can be returned in convenient instalments over time. It is crucial to remember that interest rates and repayment alternatives could differ between banks, so doing your homework before applying for a plot loan is crucial.
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How is it different from home loans?
You could be asking yourself now how it differs from a mortgage loan. Although buying a property is the goal of both loans, there are some significant distinctions between them. A plot loan is intended to be used to acquire a plot of land, whereas a home loan is usually used to buy an entirely built house or apartment. Plot loan interest rates are typically greater than home loan interest rates, which is another significant distinction between the two. The reason for this is that, unlike fully constructed properties, the value of NA plots might vary over time and may not appreciate at the same rate. Finally, a plot loan has a shorter payback period than a home loan.
Types of Plot Loans?
There are two types of plot loans available:
- Purchase of Plot from Govt. Bodies/Development Authority
- Composite Loan.
Purchase of a plot from the government. Bodies or Development Authority: This type of financing is used to buy land from government agencies, local development authorities, etc. In this case, loans up to 75% of the plot’s value are available from banks or other financial organizations, with terms as long as 15 years.
- Composite Loan: Banks and other financial institutions may provide you with a plot construction loan if you plan to start development within three years. 40% of your loan may be used for building and 60% for the acquisition of a plot. Plot construction loans have a maximum repayment duration of 30 years.
Leading Indian Banks for Plot Loans:
Given that it determines how much the interest rate will be, it makes sense that this is the primary consideration when selecting a loan provider. Therefore, in order to save money over time, it’s critical to find a bank that offers competitive interest rates. The maximum loan amount eligible, the maximum payback period, application time, processing fees, and other costs are additional criteria. Plot loans have interest rates that are either higher or comparable to those of conventional house loans.
This is a list of lenders in India that provide NA plot loans based on how affordable they are for applicants who are self-employed or have a job.
| Banks | Interest Rate (P/A) | Max Tenure | Processing Fee | Interest rate Range |
|---|---|---|---|---|
| State Bank Of India | 9.20%-9.80% | 1-30 Years | ₹2,000 – ₹10,000 One-time-free | 8.40% (Floating) |
| HDFC Bank | 8.60% | 15 Years | 0.50%-1.50% | NA |
| Federal Bank | 8.40% (Floating | 1-30 Years | 0.50% (maximum rs.10000) | Floating Rate |
| Bank of Baroda (BOB) | 10.15% | 30 years | 0.50% (Minimum Rs. 8500, Max. Rs. 25000) | 8.40%-12.10% |
| PNB Plot Loan | 8.75%-10.90% | 1-30 Years | 0.25% | NA |
| Icici Bank | 9.00%-9.80% | 20 Years | 1% ( Tax) | NA |
Home Loan Eligibility
The following is the list of eligibility criteria:
- Eligibility: The plot and home loan eligibility criteria are almost the same. It offers loans to salaried and self-employed applicants based on their:
- Age ( To be eligible for the plot loan, you must be 18 – 70)
- Employment status (You should be employed or have a regular source of income)
- Credit Score: A good credit score is important for getting approved for a plot loan. You should have a minimum credit score of at least 750 to be eligible for it.
- Some banks are not dependent on credit scores below 750; they give loans, but terms and conditions are applied.
- Income criteria (The applicant must meet the lender’s minimum income requirements)
It’s crucial to remember that different banks may have different qualifying standards, so it’s a good idea to find out before applying for a plot loan from the bank.
Required Documents for Plot Loans: The documentation requirements for a plot loan and a house loan differ slightly. The following paperwork is required in order to apply for a plot loan:
- Application form
- Age proof
- Income proof
- Employment details / Proof of Business
- Address proof
- Documents related to Plot or Land
- Approved layout/drawing of the Plot
Once more, documentation requirements differ between banks; therefore, it’s critical to confirm with the bank whether particular documents are needed for your plot loan application.
Calculate Loan EMI Plot:
Your monthly EMI payments must be a source of curiosity for you! Utilize the loan EMI calculator on Plot. You may determine the amount that must be paid as EMI once you obtain a plot loan by using an EMI calculator. To determine your estimated monthly Installment amount, simply input the loan amount, length of loan in months, interest rate, and processing fee before clicking “Calculate.” One thing to keep in mind is that these are estimates, so before making any final decisions, consult a loan officer.
