ADVANCE AGAINST RECEIVABLES
We have designed the product Loan against Rent Receivables with an objective to address the financial requirement of applicants having self owned property given on rent & enable them to get the liquidity against the expected future rentals of the property.
Property owners having their property situated in Metro/ Urban Area/ Semi-Urban areas, who have let out /leased their property under registered lease deed/ Leave & license agreement to Public Sector Undertakings/ Govt. / Semi Govt./ State Govt. reputed corporate houses, Banks, Financial Institutions, Insurance Companies, Multinational Companies, Warehouses, large retail outlets, Professionals, High Net worth Individuals, Salaried Class, Proprietary firms, Partnership firm, Pvt Limited Companies, etc.
The loan can be used for any purpose but shall not be used for purposes prohibited by law.
How the eligible amount of Loan is calculated
The eligible amount of loan will be based on the following formula:
The amount of present rent less TDS amount = X (EMI amount)
Based on X amount and the balance number of months of the lease agreement of the premises, the amount of loan will be worked out. The same to be repaid in balance number of months (No of Instalments) with maximum EMI equal to or less than X amount as given above.
The incremental increase in the rent will not be taken into consideration. The rent as on date of loan application will be considered.
Effect of Lock In Period
If the rent agreement has a lock in period, the same will be considered while working out the eligibility.
The last instalment of the loan will be fixed in such a manner that the loan closes on the date of receipt of the last month's rent.
Mortgage of property which has been let or leased and shall cover atleast 150% of the loan amount. Tripartite agreement between the borrower (Owner of the property), the Tenant and the Bank for direct payment of rent to the bank until the loan is fully repaid till the validity of the lease agreement. In case loan is to be sanctioned without Tri-partite agreement a No Objection letter from the lessee for payment of rent amount directly to the loan a/c of the loanee will be reqired. A future rents to be vide cheque in bank's favor.
Personal guarantee of two employed or self employed persons offering surety. The annual net profit in case of self employed persons should not be less than Rs 150,000. Income tax paying family members can also be accepted as sureties.
Insurance of the property covering all risks with Bankers' clause will be mandatory
The interest rate will be as per our credit policy. It is decided that the same, for applications received during March 2014 will be 13.5% - Branches to confirm the same with Loans Dept.
The loanee will be admitted as a regular member & will be required to take an amount equivalent to 2.5% of the loan towards share amount
KYC Documents Required
- KYC Documents (Identity & Address Proof).
- Property documents & valuation report from Bank's approved valuer
- Leave and License agreement copy.
- 12 months bank statement to which rentals are credited.
Up to 1% of the loan amount plus service tax as applicable.
The Following documents are required along with Application Form to process yourLoan application.
• Banks Standard Application
• D P Note
• Agreement for Loan
• Lien and Set-off
• Property documents for creation of equitable / Registered Mortgage
• Guarantee Agreement
• Tripartite Agreement / undertaking by Lessee to credit the Loan a/c with rent income.