home loans for NRI query

POSTED BY prasad bhadrashete ON December 19, 2010 8:53 pm COMMENTS (5)

Hello all,

just want to know, if its necessary to have NRE account to have home loan in India. according to information from some private banks , I got to know that NRE accout is must. I live in Malaysia for job and wish to purchase home in India.

I send money to my saving account through legal channels forex. can we show that as a proof of transaction from outside India ?

I have all the documents from the forex company which sends my money to India.

please guide me in this regards. Your suggestions/inputs are highly appreciated.

Thank you.

with regards,


5 replies on this article “home loans for NRI query”

  1. sidrana7 says:


    If you have lived more than 180 days in a financial year, you are non resident for the tax purposes. And if you are intending to remain like the tax status then you have to convert your resident savings bank account to NRE/NRO accounts formally as per the norms. No excuse for that. And if you do not do so you are falling out of line with the law which can be troublesome down the line.

    As Atul has said non residents nre/nro accounts are mandatory for the purposes. At least a nre in your case, but you need nro as well.

    And no banks will process your home loan if you are providing documents as non resident and resident bank account details. I hope you getting the point here.

    There are various ways of sending the money to India (Inward Remittance). Please note that these other money transfer means do not count as proof ot your inward remittance to your own nre account. So get one first and then apply for loan. Check with SBI or HSBC in your place in Malasyia and start from there.

    Best luck with your purchase.

  2. Atul says:

    Hi Prasad,

    Yes you need to have NRE account since there are different rules for NRI home loan application. Since the money is coming from outside India Banks need to track the source (as per RBI rules) and hence NRE account is must.



  3. Punit Gohil says:

    @Jignesh : There is a difference in Exchange rates if we send via Forex and directly to NRE account.

    For Example If Forex pay you 1 MYR = 14 INR the excahnge rate for NRE account is 1 MYR = 13 INR.

    Thats why we prefer to send via Forex.

  4. jignesh says:

    If you are earling ,sending legally through exchange, why don you open NRE account?
    i m not much aware but in NRE money is repatriable and you can take earning from india to outside if you have invested through NRE.

    let other expert have their view on this.


    1. robertdmello says:

      Just open NRE a/c in which you are applying for home loan. Just keep Rs.5,000. Following documents are required during applying home loan for NRI.

      Required papers for Housing Loan:

      1. Salary Cerificate

      2. 6 months Bank Account Statements

      3. Xerox copy of Job Contract Copy

      4. Xerox copy of Passport

      5. 3 passport size photos

      6. Local NRI/NRO Bank Account Statements

      7. 12 Cheque leaves

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