RBI eases lending norms for affordable housing

In a bid to complement the Centre’s thrust on affordable housing, the Reserve Bank of India relaxed the norms for giving loans for houses that costs under Rs. 10 lakh.

It has been decided that in cases where the cost of the house unit does not exceed Rs. 10 lakh, banks may add stamp duty, registration and other documentation charges to the cost of the unit for the purpose of calculating loan-to-value ratio.

This means, banks will now be able to offer finance for paying stamp duty and registration fee, which until now had to be paid by the home buyer.

The RBI said that these additional charges form around 15 per cent of the cost of the house and place a burden on the borrowers from economically weaker sections and low-income groups.