Know About Home Loan Processing Fees And Other Charges

Home Loan

The processing fee is the most essential and obvious price imposed on home loans. It is the cost that you have to pay to banks or NBFCs in order to process your home loan application.

It is a one-time cost that is normally paid beforehand, you must pay it to the bank/NBFC out of your own pocket rather than having it deducted from your loan amount.

There are a few banks that refer it as an administrative fee. The home loan processing fees is usually levied only after your home loan application has been granted.

On most of the home loan schemes, banks levy a processing fee. Some banking institutions, on the other hand, either do not charge a processing fee or waive it as a special offer.

Banks may charge different rates to salaried individuals (SI), self-employed professionals (SEP), and self-employed non-professionals (SENP).

All Banks’ Current Home Loan Processing Fees In 2022

In most cases, the home loan processing charge is a percentage of the loan amount. Banks may also stipulate a minimum and/or maximum charged amount. Because it is a service charge, you must also pay GST on it. The current service tax is 18%.

For This Time Period, SBI Home Loan Processing Fees Are Waived Off

The State Bank of India has announced a 50-100% reduction in home loan processing fees SBI. This offer is applicable from August 1, 2022 until September 30, 2022.

According to the SBI website, the bank has eliminated 50% of the basic processing charge for residential and home-related loans (other than takeovers). The bank has removed the minimum processing cost for house loan takeover and top-ups linked with it.

There will be no change in the Advocate and Valuer Fee- Actual Expenses, which will be collected from the customer and incurred separately.

According to the SBI website’s card rate page, the basic processing cost is 0.35% of the loan amount + applicable GST, with a minimum of Rs 2,000 plus applicable GST and maximum of Rs. 10,000/- plus applicable GST.

Home Loan Processing Fees HDFC:

HDFC provides easy home finance to salaried and self-employed individuals who want to purchase a flat/house/bungalow from a private developer. In addition, the bank makes loans for building on a freehold or leased parcel of land or on property given by a Development Authority.

For salaried and self-employed professionals, the processing charge is 0.50% of the loan amount or Rs. 3,000, whichever is greater, plus applicable taxes (SEP). Processing fees for self-employed non-professionals (SENP) are up to 1.50% of the loan amount or Rs. 4,500, whichever is greater, plus applicable taxes. You can get attractive offers on Home loan processing fee HDFC.

The Table Below Provides A Full List Of All Banks Processing Fees They Charge From Lowest To Highest:

Banks                       Processing Fee (Min. in %)    Processing Fee (Min. in amt.)
SBI Home Loan                                  0.4%                           Rs.10,000
HDFC Home Loan                              0.5%                         Rs.3,000
Axis Home Loan                                  1%                            Rs.10,000
LIC Home Loan                                     –                              Rs.10,000
IDBI Home Loan                                  0.5%                        Rs.2,500
IOB Home Loan                                  0.5%                        Rs.20,000
Union Bank of India                             0.5%                       Rs.15,000
  PNB HFL                                               1%                         –
Indiabulls Home Loan                             2%                         –
Kotak Home Loan                                 0.5%                      –
IIFL Home Loan                                    1.25%                          –
L&T Home Loan                                   0.25%                         –
Yes Bank Home Loan                            2%                          Rs.10,000
Bank of India Home Loan                     0.25%                     Rs.1,500
Bank of Baroda Home Loan                 0.25%                        Rs.8,500
UCO Bank Home Loan                           0.5%                      Rs.1,500
PNB Home Loan                                   0.35%                     Rs.2,500
IDFC First Home Loan                          –                              Rs.10,000
Standard Chartered Home Loan          0.5%                         –
HSBC Home Loan                               1%                            Rs.10,000
DBS Home Loan                                   –                               Rs.10,000
Canara Bank                                         0.5%                         Rs.1,500
  Central Bank of India Home Loan      0.5%                         Rs.20,000
Karur Vysya Home Loan                            –                          Rs.2,500
Karnataka Bank Home Loan                      1%                        –
Dhanlaxmi Bank Home Loan                    1%                        Rs.10,000
Tata Capital Home Loan                             0.5%                   –
Aditya Birla Home Loan                             0.5%                  –
Federal Bank                                                0.5%                   –
South Indian Bank Home Loan                      0.5%               Rs.5,000
Jammu and Kashmir Bank Home Loan          0.25%             Rs.5,000
Bandhan Bank Home Loan                             0.25%              –

Important Home Loan Fees And Charges Loan Processing Fees

A processing fee is a one-time charge imposed by lenders on applicants in order to process their home loan applications. In most cases, this cost is non-refundable. This cost might range from 1% to 3% of the loan amount, depending on the lender. Some lenders will also remove processing fees during holiday promotions or other special occasions.

Home Loan Foreclosure Charges

This fee is imposed as a penalty if a borrower repays their entire loan amount before the term expires. Some lenders will not allow the loan account to be foreclosed until a certain number of EMIs have been paid. However, RBI regulations prohibit banks and HFCs from charging foreclosure fees on variable interest rates.

Charges For Partial Prepayment

This fee is imposed as a penalty if a borrower prepays a portion of the loan amount. Individuals, however, are excluded from prepayment penalties on floating rate home loans. Individuals who choose a dual rate home loan may be subject to a prepayment penalty during the fixed interest rate term. Banks and HFCs cannot impose a prepayment penalty once the loan begins to accrue a variable rate.

Penalties/Deficiency Interest/Late Payment/Overdue (Per Month)

Defaulting on home loan monthly payments results in the imposition of penalties on overdue EMIs. This fee might be either a fixed sum or a percentage of the unpaid EMI (s). For example, IDFC First Bank charges 2% of the unpaid EMI, or Rs 300 whichever is higher.

Conversion Fees

Conversion fees are charged by banks and NBFCs when changing a fixed-rate house loan to a floating-rate home loan or vice versa, or when converting an existing fixed interest rate to a revised one. For example, in the case of HDFC Ltd, the option of moving the loan from fixed to floating rate is available for a payment of 0.5% of the principle due at the time of conversion or Rs 50,000 plus taxes, whichever is less.

Administrative Fees

In addition to the home loan processing fee, many lenders levy an administration fee. This non-refundable fee is levied to cover the costs of legal verification, document analysis, and property appraisal. Borrowers should compare this cost when weighing their mortgage options. Prefer lenders with low administrative fees fixed or have an upper cap on them.

Documentation Fees And Fees For Home Loans

  1. Stamping Fee: This fee is levied on any legal document between you and the bank that requires signature on stamp paper. The fees will be charged on the actual costs gained.
  2. Income Tax Certificate Fee: Most banks will not charge you a fee to supply you with a provisional or final income tax certificate for your home loan interest and principal repayment. Nevertheless, the charges may vary from 0 to Rs.500 every time you are applying for the loan.
  3. Interest Certificate Charge: This is when you require a certificate from the bank detailing the amount of interest you paid during your loan repayment. The charge per home loan request ranges from 0 to Rs.500.
  4. NOC/NDC Fee: This is the fee you must pay to obtain a No Objection Certificate (NOC) or a No Dues Certificate (NDC) (NDC). The charge per application ranges from 0 to Rs.500.
  5. Charge for Duplicate NOC or NDC: If you require a duplicate copy of the loan account’s or property’s NOC or NDC, you may be required to pay a price. This usually ranges between Rs.100 and Rs.500 each incident.
  6. Fee for Revalidation of NOC: If you need the bank to revalidate your No Objection Certificate, this is the fee. The typical fee ranges from Rs.100 to Rs.500.
  7. Agreement Copy Cost: If you require a copy of the loan agreement, you may be required to pay a fee to the bank. This can range from 0 to Rs.500. These fees are applicable on any document required from your bank.
  8. Issuance Charge for Photocopy of Title Documents: You may be charged between zero and Rs. 1,000 each time you seek a copy of your property’s Title Documents, the originals of which will be kept by the bank until the loan is fully repaid.
  9. Duplicate Statement Issuance Fee: You must pay this fee if you require a duplicate statement of your loan account. It’s also denoted as the statement charge or the Statement of Account Issuance Fee that starts from Rs. 0 to 250.
  10. Issuance Fee for Amortization Schedule: If you want a thorough amortization schedule for your loan period, you may have to pay between zero and Rs.250 per request.
  11. Document Retrieval Fee: This is charged at the end of the loan when you require all of your property’s original documents returned from the bank/finance firm. The fees range between Rs.500 and Rs. 5,000.
  12. CIBIL Report Price: If you demand a copy of your CIBIL credit report, you will be charged a fee ranging from zero to Rs. 1,000 each instance.
Home Loan Legal/Government Fees

Legal Fees: The legal fees are paid to cover any legal fees associated with the home loan processing fees in SBI. This could involve enrolling for the tripartite agreement between you, the builder, and the bank/NBFC, as well as confirming any other required documents. The exact amount will be decided on the actual fee charged by the legal advisor.

Valuation/ Inspection Fee: The bank will charge the inspection fee for the legal evaluation and scrutiny of the property you are buying and seeking for the home loan. The amount you must pay is decided by the actual expenses.

MOD Charge: The Memorandum of Deposit of Title Deed (MoD) shows that you have submitted the bank your property’s title deeds/ownership papers as collateral for the loan. It verifies the specific property’s ownership. It is also known as MODTD, DTD, or MODT and is transcribed on non-judicial stamp paper.

If your property is involved in a legal dispute, this paper may be handy. The MoD charges varied depending on the state. In Karnataka, for example, the MOD charge is 0.1% to 0.2% of the property’s cost (min. Rs.500 and max. Rs.10 lakh).

CERSAI Charge: CERSAI is an abbreviation for the Central Registry of Securitization Asset Reconstruction and Security Interests of India. When you pledge your property to a financial organization, you must register the assurance with CERSAI. This must be done to stop the same asset from being used as security for home loans. CERSAI fees starts from Rs.50 ad goes up to Rs.500, subject to the action taken.

Source- Bankbazaar

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