Purchase of a flat in an apartment complex – Banks finance their customers to buy flats in residential complexes. Here you have the concept of an Undivided Share (UDS) in the land.
Purchase of individual house –This is similar to the type of Home Loan described above however there is no concept of ownership of UDS. The entire land belongs to the borrower. Naturally, such houses have a better resale value.
Purchase of Land/Plot –Banks finance their customers for the purchase of vacant plot or land for subsequent construction of house. Usually, banks stipulate that the construction of the house should begin within one year of purchase of land for the loan to be treated as a Home Loan.
Construction of a house on own land/land purchased out of bank finance –You can avail a loan for constructing your house on your land. Banks have their methods of determining the cost of construction. Naturally, you need to obtain the requisite permission from the local municipal authorities for constructing your house on the land. You need to have an approved plan as well.
