Home Loans for Self Construction

It becomes easy to construct residential property with us

An easy lending facility for you to purchase a plot and construct a home is one of the most popular ways to make your dream home a reality.

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About Home Loans for Self Construction

People can avail of home loans to get their house constructed- either by themselves or by employing a contractor to construct the house on a plot they own. Such loans are commonly termed ‘construction loans’. The process of approval and disbursement of a home loan for self-construction is different from that of a regular home loan.

Altum Credo will extend the loan for the construction of the house on a self-owned plot or for the purchase of the plot and construction of the house under this service.

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Loan Amount
  • The minimum loan amount under home loans for self-construction is capped at Rs. 4 Lakhs. The maximum loan amount for the same goes up to Rs. 25 Lakhs.
Tenure
  • The minimum tenure is 5 years and the maximum tenure offered under home loans for self-construction is 15 years.
  • We look at certain tips for obtaining a loan for constructing a house on a self-owned plot of land.
  • Loan amount: If the land is free from loans, even 100% construction funding can be available. The banks compute the loan amount as per the market value of the plot. They accept the value of the land as self-contribution for availing of the loans.
Ownership status of the land
  • The ownership – the titleholder(s) of the plot is the most significant issue. The land could have been purchased from an independent landowner/developer. It could have been inherited from the present owner’s ancestors.
Basic facilities /amenities available
  • Gated communities are preferred by lenders. If the plot is within a gated community with standard facilities already present such as water and electricity connections, and roads laid then it is simpler to obtain a loan.
Statutory requirements

  • The plot should possess all necessary clearances from the local town-planning authority as well as the government. It should not be in an agricultural or commercial or green zone. If it does fall into the mentioned categories, funding is not possible as per conventional criteria for home loans.
Necessary documents
  • It is mandatory to have a sanctioned plan from the concerned town-planning authority or the corporation of the city. Tax dues on the land should have been cleared completely.
Tranche disbursement
  • Usually, the loan disbursement is in tranches. For instance, if 50% of the construction is completed, 50% of the loan funds will be released. If the fund’s disbursement is in advance, only on a valuation person’s report that the disbursed sum has been used for construction and satisfactory progress is made will the next tranche be released

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