Term Loans and Auto Loans Overview

Podcast

Play an AI-generated podcast conversation about this lesson

Questions and Answers

What is the maximum age permitted for co-obligants when applying for a loan?

75 years

65 years

70 years (correct)

80 years

Which of the following conditions must be met for a loan applicant's age to exceed 70 years?

A co-obligant must be under 50 years

At least 50% income from co-obligants (correct)

Additional income from investment portfolios

Loan amount greater than $500,000

For NRI applicants applying for a loan, what is the maximum age limit considered?

70 years regardless of income

65 years or retirement age

75 years under special circumstances

60 years or retirement age (correct)

Which group of people can be classified as close relatives for the purpose of co-obligancy?

Parents and siblings Signup and view all the answers

What is required for unmarried or divorced individuals applying for loans while employed abroad?

Eligibility through liquid collateral Signup and view all the answers

What is the minimum recovery track record required for a home loan under the Repayment Track Record (RTR) criteria?

18 months Signup and view all the answers

For individuals with savings accounts, what is the required savings to qualify for a loan in relation to the EMI?

1.5 times the EMI Signup and view all the answers

What is the maximum loan amount available under the Repayment Track Record criteria?

Rs.300 L Signup and view all the answers

Which of the following documents is needed for NRI Self Employed individuals when applying for a loan?

Audited Balance Sheet Signup and view all the answers

What is the maximum allowed EMI for a proposed home loan if the borrower has a repayment track record of more than 36 months?

125% of EMI of loan Signup and view all the answers

What is the minimum total income requirement for NRI applicants?

Rs.30000 Signup and view all the answers

How many transactions are required in a current account to qualify for a loan?

24 Signup and view all the answers

For NRI lending, what type of remittances are to be excluded from the income calculations?

Bulk remittances Signup and view all the answers

What is the maximum tenure for a loan against self-occupied residential property for residents?

180 months Signup and view all the answers

Which individuals are eligible for securing a loan if the property is in a third party's name?

Close relatives as defined by CA2013 Signup and view all the answers

At what minimum age can individuals apply for a loan, unless they are confirmed employees?

24 years Signup and view all the answers

Which of the following is a requirement for residence property to be used as security for a loan?

The borrower must be the legal owner of the property Signup and view all the answers

Which of the following entities can apply for an auto loan for private use?

All of the above Signup and view all the answers

Study Notes

Term Loan and Overdraft

Available to individuals (residents, non-residents, PIOs) with sufficient repayment capacity.
Applicable for sole proprietorships, family partnerships, professionals, and salaried individuals for personal or business use.
Minimum loan period of 12 months, maximum up to 120 months; for self-occupied residential property, maximum can be 180 months if future life of building is certified for 10 years post-maturity.
Minimum age requirement is 24 years; exceptions if the borrower is a confirmed employee at a younger age.
Self-employed applicants must have a business history of at least two years.
Security property must be in the name of the individual borrower or a close relative as defined by CA 2013.
Property must belong to NRIs and PIOs for granting Property Power.

Auto Loan

Intended for purchasing brand new and used vehicles for private use.
Eligible applicants include individuals, sole proprietorships, partnerships, companies, trusts, educational institutions, and lawful organizations with sufficient income.
Loan terms can extend to those up to 80 years if a successor joins as a co-obligant.
NRI applicants: salaried and self-employed must be 55 years or younger.

Permitted Deviations

Borrowers' age can extend to 70 years, provided:
- At least 50% of income comes from co-obligants.
- Co-obligant's age does not exceed 65 years for residents or 60 years for NRIs.
Loans can be considered after retirement age based on pension income.
Home loans are available up to 70 years old with sufficient salary and CIBIL score criteria.

Co-obligancy

Required for spouse or close relatives if income is clubbed.
For PIOs/OCIs, a close relative residing in India must be a co-obligant.
All owners of the property must join as co-obligants.

Close Relatives

Close relatives include spouse, parents, major children, brothers, sisters, and in-laws (father, mother, son, daughter).

Additional Criteria and Deviations

Fully secured loans by liquid collateral may qualify; includes provisions for unmarried/divorced, employed abroad, or bedridden.
Resident salaried employees should meet specific employer categories.
Evaluate the EMIs of all loans in the past 12 months alongside proposed loan EMIs.
Savings and current account criteria for eligibility are defined based on credit summation and number of transactions.

RTR (Repayment Track Record)

Applicable for Home Loans & Top Up Equity Loans with a maximum loan amount of Rs.300 L.
Focused on existing customers and takeovers; a minimum record of 18 months is required.
Proposed loan EMI must be within stipulated levels based on existing repayment track.

NRI Lending

NRIs must meet a minimum monthly income of Rs.50,000 and take-home pay of Rs.30,000.
NRI salaried applicants require recent salary certificates and salary slips.
NRI self-employed applicants need audited balance sheets and business account statements.
Regular income must reflect in NRE accounts with bank documentation required, excluding bulk remittances.

Studying That Suits You

Use AI to generate personalized quizzes and flashcards to suit your learning preferences.

Description

This quiz covers key aspects of term loans and auto loans, including eligibility criteria, repayment periods, and borrower requirements. Understand the distinctions between loans available for personal and business use, as well as important details regarding security and applicant qualifications.