Jammu and Kashmir Bank offer home loans to employees and self-employed individuals. JK Bank home loan can be used to construct or purchase a house/flat or land.

Additional loans within the total credit limit for renovations, extensions, alterations, and improvements to the existing house or flat are also offered under the credit facility. You can also apply for this loan to buy or build another house.

The maximum repayment period for a home loan is 30 years, with variable interest rates from 7.20% and 7.30% per year for priority and non-priority sectors, respectively.

The loan processing fee is 0.25% of the loan amount plus GST. A 50% fee waiver is provided to women borrowers (individuals and joint borrowers).

JK Bank Home Loan Eligibility

Individuals with a permanent source of income and those who fall into one of the following categories are eligible:

• State/Central Government permanent employees and employees of semi-government institutions
• Employees of well-known companies with at least three years of service
• Professional, self-employed individuals/businessmen with at least three years of experience.
• Persons engaged in agriculture and related activities.
• State/Central Government retire employees and employees of Public Sector Undertakings.
• Non-Resident Indians (NRIs) are also eligible for grants under the scheme. Sanctioning authorities will determine the income of non-residents and take the necessary measures to approve and repay such loans. [1]
• In the event of repairs/renovation/ addition to the property of ancestors in the name of father or mother, dependent on son or daughter, the loan can be given to the parents by taking son or daughter as co-borrowers, and their income can be considered to calculate the loan amount. 
• In all these cases, however, the mortgage is compulsory, and all the parents’ legal heirs must be guarantors of the loan amount.  

Minimum and Maximum Age for J&K Bank Housing Loan 

The minimum age to apply for a housing loan is 18, and the maximum is 70 years. 

Suppose the loan amount is calculated by adding up the income of the spouse/children. In that case, the age of the youngest borrower/co-borrower may be considered when determining the loan period, provided his contribution to the repayment is over 50%.  

Also Read: Central Government Computer Courses Scheme

Loan Amount 

Several factors are considered to determine the loan amount, such as the applicant’s income, ability to repay, age, assets and liabilities, and proposed house estimate/flat. 

The options below can be added to increase your JK Bank home loan amount:

The income of spouses/children living with the applicant provided that:

• They have a stable income and a salary account with a bank (preferably J&K Bank) or a stable income from any commercial activity. The credit reporting officer and concerned sanctioning authority will determine after due diligence.
• One of them will become a co-borrower, which means the loan will be provided in a joint name.
• The house/apartment/land is in their joint possession (options for the spouse) 
• Only the residual income will be considered, which means net income after all deductions, including deductions for already taken loans (if any) 
• The spouse/child has income-proof documents, which must be obtained per the system for income-proof verification.
• Expected rent (after deduction of taxes) if the purchased or constructed house/apartment is for rent.
• All sources of regular income. 

Therefore, the loan amount is estimated as follows:

Loans for new construction/purchase of house/flat

• Construction costs/ by a lower agreed margin.

Loan for State/Central government pensioners

• Thirty-six (36) monthly net pension provided that the pensioner will repay the loan in full by the time he attains the age of 70, and the total deduction towards loan repayments does not go beyond 50% of the monthly income.

Loans for repairs/improvements/extensions/modifications:

• The maximum amount of JK Bank home loan is 25 lakhs in case of repairs/improvements of house/flat. Extensions/alterations to houses/flats that have not been obtained with bank financing or loans are already repaid/adjusted; there is no maximum loan amount if additions/alterations are made with the relevant authority/municipality’s permission.

Purchase of Land 

• Home loans can be given to purchasing a plot to build a house. The amount to buy the plot shall form part of the overall sanctioned loan and is limited to a maximum of fifty (50) lakhs or 60% of the land price, whichever is lower, provided the proposed area does not exceed 5440 square feet or 1 Kanal. [2]
• The loan amount for land purchase must be within the overall limit of the loan eligibility and should not exceed 60% of the total eligibility. 

Loan for those who have already taken a loan  

• For borrowers who have already availed of a loan for the purchase of a plot/land for the construction of a house, the loan limit is set, considering the price of construction (house/apartment) reduced by the stipulated margin.
• However, it must be ensured that the loan EMI towards constructing a house/flat with the EMI for a loan already availed for land purchase does not exceed the stipulated deductions.

Interest Rates of JK Bank Home Lone

• In the priority sector, the interest rate is 7.20 % per year
• For the non-priority sector interest rate is 7.30 % per year

Loan Processing Charges

• The processing fee is 0.25% of the loan amount + applicable GST.
• Minimum charges are Rs. 5,000-00
• Maximum charges are Rs. 25,000-00
• Loan takeover from other banks/ FIs has no processing charges 
• A discount of 50% on processing charges shall be given to women borrowers (single or joint borrowers) [3]

Loan Security

There is no need for collateral /3rd party guarantee for a home loan in all cases except in the following circumstances:

• Pensioners require a guarantee of spouse / legal Heir(s), who is/are entitled to a family pension.
• Non-Indian Residents (NRIs) need a guarantee of two Indian residents. 
• Loans up to 5 lakh (Rs10 lakhs for Government employees of UTs of J&K and Ladakh) are given for repairs/additions/ modifications/extensions to existing homes, where the house’s mortgage is not taken as collateral. 

Moratorium Period  

• Maximum nine (9) months (12 months for J&K and Ladakh Union Territories) from the first payment date for loans approved to construct a house/apartment.
• For loans meant to repair/modify/add three months from the disbursement date.
• Up to 3 months if a loan was provided for purchasing a completed house/flat /apartment/land.

Conclusion

The Jammu & Kashmir Bank offers housing finance under the JK Bank home loan scheme. The objective of this loan is to provide finance to construct a house/flat or buy a plot. The loan is also provided for renovations, extensions, alterations, and improvements to an existing house or flat under this scheme.

This loan can also be obtained to construct or purchase a second home. Eligible customers can get the home at affordable interest rates. These loans are provided at an interest rate of 7.20% per annum for the priority sector and 7.30% per year for the non-priority sector. 

The repayment period for this loan is 30 years for a salaried person and 20 years for others. The loan processing charges are 0.25% of the loan amount plus GST. Women borrowers can avail 50% discount on the processing fee. Loan for those who have already taken a loan