Home Loans in India for NRIs, OCIs and Foreign Nationals

Under FEMA rules, NRIs and OCIs may buy residential and commercial property but not agricultural land, plantations or farmhouses. Foreign nationals not of Indian origin generally cannot buy, with exceptions such as those who are resident in India under valid visas for long periods.

Home-loan lenders include SBI, HDFC, ICICI, Axis and LIC Housing Finance. They offer NRI-specific loans, assessed on foreign income, and require a power of attorney holder in India for legal steps.

If you are a foreign national, speak to a lawyer first.

Home loan rates in India typically ranged from about 8% to 9.5% in recent years, linked to the repo rate through external benchmarks. NRI loans can run up to 80% to 90% of cost for smaller loans, and terms of 15 to 20 years are common.

Loans are in rupees, and repayments must come from NRE or NRO accounts. Test variations in the mortgage calculator.

NRI applications need attested copies.

New projects should be registered under RERA.

1. Select a RERA-registered project.
2. Get a loan sanction.
3. Sign the builder-buyer agreement.
4. Pay the stamp duty.
5. Register the sale deed.
6. Receive possession.

Many NRIs pay in tranches linked to construction. Equity from overseas homes can lower the cost. See apartments, villas and land.

Stamp duty varies by state.

Indian tax law treats gains and rental income differently for NRIs, and a double taxation treaty may apply. Take advice.

Selling proceeds can be repatriated within limits via authorised banks.

Check the title chain, approvals and litigation records. RERA portals show project status.

Attestation is the most common obstacle: documents signed abroad may need to be notarised or attested by the Indian embassy, and a gap can delay sanction. Salary slips should show the employer, and the bank may ask for a certificate from the employer confirming a minimum period of service. Keep scans of your passport pages, work permit, and recent statements in one folder to avoid repeated requests. If you use a power of attorney, make sure it is limited to the specific purchase and registered locally.

Mumbai, Delhi NCR, Bengaluru, Hyderabad, Pune and Chennai have the deepest markets, while smaller cities offer lower prices and lower liquidity. Under-construction projects are cheaper but carry delay risk, whereas ready-to-move properties cost more but can be rented at once. Banks prefer projects with approved plans and a good developer record, and some refuse loans on projects with pending approvals. RERA state portals publish project completion dates and complaints.

Repayment from an NRE account is freely repatriable, while NRO accounts carry limits and tax withholding. If you sell later, the buyer must deduct tax at source, and capital gains tax depends on the holding period. Plan the exit before you buy: look at the price history of the micro-market, the rental yield (often modest compared with the price) and the cost of selling through an agent.

Confirm RERA registration, the approved layout, the encumbrance certificate for the last thirty years, and the builder's completion record. Ask for the exact carpet area, not the loosely defined super built-up area, since prices per square foot differ. Make payments only by banking channels from your NRE or NRO account, and keep every receipt and demand letter. Discuss with a chartered accountant how rental income and sale gains will be taxed both in India and where you live. Finally, ask the lender whether prepayment charges apply to floating-rate loans (they generally should not for individuals) and whether the bank offers a top-up facility for furnishing, which is cheaper than a personal loan.

Use our consultation guide for legal details and the market analysis for city comparisons. Cheap homes.