Home loan refusal

POSTED BY Sunny ON July 7, 2011 8:40 am COMMENTS (3)

And can a bank deny me a home loan if I have all the documnet in place? I have finalised a property in Nalasopara-E, Mumbai and ICICI Bank says they dont approve loan in Nala Sopara or Naigoan region. Is that illegal, assuming all the property and income proofs are in place?


And if Big bank refuse to lend me money and i go to small playesr like Federal banks, are there any drawbacks like they will increase the loan rates any time abruptly?

Also What does margin money means in Home loan?

3 replies on this article “Home loan refusal”

  1. Sanmuga says:

    Hi Ashal,

    we are planning to take housing loan on SBI maxgain.Project is land purchase and construction of villa with in 1 year.Land cost 24L and Construction cost 35L.We approach sbi,they are telling 2 separate loan is the only way.So first we are applying HL1 for Land (80% of total ) 18L this month.

    Once it sanctioned again we need apply the HL2 for 23L (80% of construction as per sbi valuation).Once 2 loan sanctioned we need to do mortgage for (0.5 % of total loan amount like 18+ 23= 41 L) 20,500 stamp paper along with registeration charge 6000.

    This is the scenario explained by the bank staff.

    we applied for Home loan 1 for land purchase on sep 10th 2012.From SBI Branch ,they are telling its rejected due to some reasons like they are expecting collateral.

    In our Branch manager told,once loan sanctioned u can do registeration and then do mortgage for sbi.For intermediate period we are providing third party guarenter and his documents.

    But its rejected by RACPC.SBI branch manger telling again we are trying to get sanctioned with out collateral and Regional manager is also ready to process the loan with out collateral.

    Please clarify ,

    is it mantatory to produce collateral ?

    Our SBI branch in krishnagiri District ,then which RACPC will handle this ?

  2. Sunny says:


  3. ashal jauhari says:

    Dear Sunny, Any bank has the final say to offer or not a home loan. Please try to get the clear answer from ICICI people. You may opt from any other bank of your choice, subject to fulfilling the basic requirements of bank in question.

    Margin money – The difference of Loan amount to final price paid to builder or seller of the property from your own funds is called the margin money. For example –

    Coast of Flat = 25L Rs.
    Loan amount = 20L Rs.
    Margin Money = 25-20 = 5L Rs.

    Thanks Ashal

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