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Maharaja Hari Singh incorporated the Jammu and Kashmir Bank (J&K Bank) in 1938. In 1939, the bank commenced operations as a universal bank in J & K and in rest of India, as a specialized bank. It is listed on the NSE and BSE. This bank has 900 ATMs throughout India and 821 computerized branches. It aims at increasing lending in home state and capture niche lending opportunities around the country to improve margins and fund volumes.
Besides collecting central taxes for CBDT, it is the only private sector bank as RBI’s agent for carrying out banking business for the Central Government. It has a host of services such as corporate banking, cash management, private banking, consumer banking, credit cards, home loans and more.
The Purposes of J&K Bank Allows Housing Loan Scheme
1. Loan is available for purchasing land for residential purpose, but the land must not be greater than 5440 square feet or one kanal for housing purpose
2. For constructing residential house or buying of any flat or house
3. In case the applicant has not taken housing loans from the bank but needs loan for renovation, alteration, repair of the property
4. Borrower can take loan to construct a residential flat on the same land for which loan has been taken for housing purpose.
Quantum of the Jammu and Kashmir Bank Home Loan
1. If the loan is taken for additional or supplementary finance to renovate, repair, alter, add to the property that has already been purchased on housing loan, the applicant can borrow Rs. 25 lacs or borrow 36 times of his/her net monthly income or salary on the condition that the total loan (BOS of current loan + amount sanctioned for additional loan) as reflected on sanction date is in the total housing loan ceiling up to 72 times of the person’s net monthly salary or income.
2. The applicant can seek up to 72 times of his/her salary or monthly income for home loan taken to construct residential house or purchase a flat or house
3. 15 lacs or 36 times of the applicant’s net monthly salary or income or 75% of the total cost of the plot land can be given to borrowing on a land nor more than 1 kanals for housing purpose or 5440 sq. ft. of land purchase.
4. 36 times of the applicant’s net monthly salary/income, or Rs. 25 lacs can be sanctioned for loan used in renovation, alteration or repair of the house, but any home loan must not have been taken from the J&K bank.
5. In case the borrower is any government or state pensioner, then he/she can borrow 36 times of gross monthly pension on the condition that the bank home loans approved are to be repaid fully by the time the applicant reaches the age of 70 and the total deductions are not more than 50% of their monthly take home pension.
Jammu and Kashmir Bank Commercial Premises Finance
This is a type of term loan. Applicants can seek loan to use or acquire commercial properties. But, this home loan type must be repaid in regular intervals and follow a regular payment patterns. The commercial properties can be offices, shops, etc that are rented to varied bodies such as semi-government, self-governed entities, government etc.
The applicant does not have to pay monthly instalments immediately on taking the home loan. But, as an extension to commercial premises finance, the EMI is payable only later to 1 month from the first disbursement’s date.
Jammu and Kashmir Bank Home Loans Interest rate
1. If less than or equal to Rs. 50 lacs is borrowed, the bank charge base rate interest, but if the amount borrowed exceeds Rs. 50 lacs but is less than 75 lacks, then the bank charges 0.75% extra on the base rate.
2. For loan amount more than Rs. 75 lacs, the additional charge on base rate will be 1.50%.
3. For commercial premises finance, interest rate is 12.70% for loan amount up to Rs. 15 lacs, and internal rating is performed to decide suitable interest rate if the loan amount exceed Rs. 15 lacs.
|Up to Rs 100.00 lacs||One Year MCLR|
|Greater than Rs 100.00 lacs but until Rs 300.00 lacs||One year MCLR+0.20%|
|Above Rs 300.00 lacs||One year MCLR+ 0.35%|
- Current Interest Rate: 8.65% to 9.15%
- Loan Amount: 5 lacs to Rs. 10 crore
- Loan Tenure: 1 to 30 years
- Processing Fee: It is not more than 0.25%. For commercial premises finance, a minimum of Rs. 500 and up to Rs. 10,000 with service tax is applicable along the charge of 0.25%. No processing fee of loan takeover from other financial institutions and banks
- Lowest EMI: 994 per lac
If the home loan is used for renovation, additions, alterations, repairs or supplements then margin is nil for amount up to Rs. 5 lacs but 10% if the loan exceed Rs. 5 lacs and up to Rs. 10 lacs. A loan amount more than Rs. 10 lacs calls for 15% margin.
If the J&K bank home loan is sought for purchase or fresh construction of residential house, the margin is 10%, 20%, 25% for loan amount Rs. 30 lacks or less, Rs. 30 lacks to Rs. 75 lacs, more than Rs. 75 lacs, respectively.
Jammu and Kashmir Bank Home Loan Eligibility
1. Any individual, non-resident Indians, joint borrowers, joint family members with regular income so that he/she can pay off the housing loan EMIs on time.
2. Age: For salaried, minimum age 21 and maximum, age 60 years. For self-employed minimum age 21 and maximum, age 65 years.
3. Salaried employees must be from the Government department with a minimum of 3 years of service in autonomous bodies/public sector undertakings/reputed companies etc.
4. Applicant who is a pensioner must have been employed with state or central government, and drawing monthly pension from bank and the spouse must be still alive to be eligible for family pension.
5. Those who are self-employed or professional, a minimum of 3 years of standing experience is needed in professions such as dentists, engineers, chartered accountants, architects, doctors, cost accountants, advocates, management consultants, company secretaries etc.
6. If the applicant is a woman or businessperson, then they should have dealings with the bank and a minimum of 3 years of experience.
7. For others, the home loan from this bank is allowed for applicants needing funds for repair, renovation, addition, alteration for ancestral properties in name of mother or father, who is dependent on son, and son must be co-borrower. His income will be accounted to calculate the loan amount granted. In all these cases, house mortgage is mandatory and every legal heir of the parent/s must agree to be guarantor to the housing loan.
8. For commercial premises finance, the applicant (individual, partnership concerns, public limited, specialized personnel, professionals, self-employed, and private limited companies), must have 3 years of running business. 4 times of net income over a year is allowed, as loan but maximum amount cannot exceed Rs. 50,000. If the applicant is married, then spousal income can be considered to calculate loan amount to be given.
How Do I Close Jammu and Kashmir Home Loan through Creditseva?
Home loan closure or settlement relieves borrower from the housing loan and ensures that he/she receives proof or testament that the property now belongs to the borrower, and the bank has no hold over the same. Thus, it is very important to know everything and home loan closure, the documents to receive etc.
Creditseva informs you about the guidelines and rules laid down by the J&K Bank in respect to its home loan closure. If you are looking out to close your J&K bank home loan, then here is what you need to do:
- Sign up or sign in to your user account at Creditseva
- Simply follow the steps provided by our financial experts
You should not follow any other methods for closing the J&K bank home loan that is not advised by financial advisors. It is best to comply with the steps stated here for quick home loan closure.
We at Creditseva promise you a hassle-free closure of your Jammu and Kashmir bank home loan in the mentioned below four methods:
- Closure through prepayment of housing Loan
- Closure through completion of home loan tenure
- Closure on account of bad loan
- Closure through settlement of home loan.
J&K Housing Loan Closure by Pre Payment
You can prepay the home loan by following these steps:
Step 1: Visit the bank personally at branch working hours. You do not have to visit the bank branch from where the loan was taken. It is advisable to make visits on a weekday, as prepayments may possibly not happen on weekends.
Step 2: You will have to comply with some mandatory checks and formalities for which you have to meet the bank representative, who will take you through the complete procedure.
Step 3: The representative will provide you with a disclosure form, in which you need to fill out details related to your sources of income, which you will utilize for partial or full prepayment. The exact amount may not be disclosed, but approximates are relayed.
Step 4: The prepayment amount is now calculated and you must hand that amount cheque in favor of the ‘Jammu and Kashmir Bank Ltd’.
Step 5: You will receive the receipt of prepayment, which signified that the home loan is now successfully paid off.
Step 6: Do ask the representative for the amortization sheet that offers details of all the EMIs paid until now. You can request to get the same by email or you can download it from the bank’s official website via the login portal for home loan.
Step 7: After the release of prepayment, the registrar couriers the property deed file to the Jammu and Kashmir bank. The process takes almost 10 to 15 days. You must collect the same from the bank than having it couriered as it will protect the property deed from any damages or tear susceptible to during transit.
J&K Home Loan Closure on Completion of Tenure
When you pay off the last EMI on your home loan:
- You can initiate closure of home loan by posting a written loan closure application to the nearest Jammu and Kashmir bank branch.
- You must carry the proof of last EMI paid. Attach this along with the written application.
J&K Home Loan Closure on Account of Bad Loan
If you become bankrupt or are unable to pay off the loan under any circumstance. In such cases, the status assumes ‘Default’ on home loan and remains this way until the loan is not written off. Once written off, the loan is stated as bad loan.
- Post a written ‘home loan closure’ application to the nearest branch of Jammu and Kashmir bank.
- You can also visit the nearest bank branch of your home loan provider with the application for loan closure.
The following events take place:
Your home loan status has to be changed from ‘Default’ to ‘Settled’
- Statement of Account (SOA) update: It comes in form of statement print out or passbook that has information on all transactions in your bank account. The details are about all deposits, balances and withdrawals. It will also reflect the bad home loan settlement as written off.
- Update on Credit Score: Any bad loan closure affects your CIBIL score. In case the repayments were done timely, then the negative score can be worked on.
J&K Home Loan Closure through Settlement of Loan
Home loan closure by settlement occurs if dues are not being paid. This is more common than bad loan.
- The bank considers 3 months for analyzing your repayment recoverability.
- The loan account is marked as NPA if the amount is yet not recovered.
- You become a ‘defaulter’ until loan settlement takes place.
- Your CIBIL score may be impacted for a short-term duration.
- However, the credit score will build overtime when if you had made timely repayments of EMIs.
- You can write a loan closure application after the visit to the Jammu and Kashmir home loan branch.
The following events take place:
- SOA Update: Until repayment is not done, the home loan will reflect here as settle. You can opt to prepay the outstanding amount, restructure the loan or reimburse the investment.
- Offer Letter: After home loan settlement, it reflects as ‘settled’ in your bank account.
- Credit Score Update: Loan settlement is a full closure of loan. Thus, it will affect your credit score, but with time on credit report receipt, it will normalize.
Sample Letter for Jammu and Kashmir Home Loan Closure
The Bank Manager
Jammu and Kashmir Bank
[Address of the branch where closure of home loan was done]
Subject: Request to close my home loan
I, [Your name] had a home loan which I have now successfully paid. No dues are left. The loan was issued under my account number – […………………] which I have successfully repaid. I am attaching the proof of last EMI payment. I humbly request you to close the home loan at the earliest and deliver the letter of acknowledgement to me, which authorizes the successful closure of the loan. After closure acknowledgement, the following documents shall be due for collection:
- Original Property Documents
- Loan closure certificate or NOC/NDC
- CIBIL score update
Thanking you for the assistance
Essential Documents You Will Receive on Home Loan Closure
On tendering the written application or letter to the bank for home loan closure, you are entitled to receive these following documents:
1. Property Deed: This is a collection of documents: original sale deed, cancelled cheques, possession letter, payment receipts and POA. Do collect all original files and not their copies. The property deed is important when you sell the property in future or consider applying for loan against property.
2. No Object Certificate (NOC) or No Dues Certificate (NDC) or Loan Closure Certificate (LOC): This document is a proof that your property is free from the control of the bank. The bank’s NOC letter must mention that the loan’s principal amount and interest are paid off.
3. CIBIL Score: Your CIBIL score updates every month on the 28th. The bank shares all details of loan related payments to CIBIL. Thus, the way a home loan is closed impacts the credit score update. Your creditworthiness may weaken initially, which may affect your chances of securing a new loan in the next 6 months. However, your credit score will build gradually if you work on it. Follow a healthy financial planning to boost your CIBIL score.
4. Memorandum of Deposit: The Jammu and Kashmir Bank will generally provide you with MOD at the very start of the loan.
5. Thank you Note and Promissory Note.
Important Precautions to Take
Once the home loan clears off from the J&K Bank, follow the mentioned steps:
1. Original Documents from Bank
- Approved layout and map issued by governmental authority or similar
- Original title and deed document
- Original or certified copy of title deed of previous owner
- Legal Scrutiny Report that all dues have been cleared.
- Original property tax paid receipts or copies if possible.
- Statement of loan account reflecting all details of loan and interest repayments.
2. Removal of Lien
- A lien is a transaction registered with registrar of properties on the property held by the bank as a home loan taken on it. You cannot sell the property, which entails a lien.
- The lien is made by banks in order to prevent borrowers from property selling prior to the housing loan repayment.
- Firstly find out if a lien exists or not and then communicate with the bank executive to free your property from lien.
3. Encumbrance certificate (EC)
- The EC contains information on performed transaction in the name of the property.
- The registrar certifies and issues the property as free from lien or debt.
- You can obtain the EC by writing an application to the J&K bank, and collect the certificate from local registrar’s office.
4. Lawyer clearance certificate
- This works as a second certification on the property’s clearance from lie and debt
- The lawyer clearance certificate will be useful during the sale of property.
J&K Bank Home Loan Closure FAQs:
1. When should I visit the Jammu and Kashmir bank for home loan closure?
Weekdays are preferable to get your loan closure procedures done on time.
2. Are there are fees on prepayment of housing loan?
Prepayment charges and penalties may or may not apply on the loan closure as per bank rules.
3. Which information I must be aware of before closing the home loan?
- Principal and interest statement
- Home loan EMI statement
- Final home loan closing statement
4. Can I repay the loan by any other way with the bank?
The J&K bank may offer accelerated repayment scheme. Do check with the bank branch to get complete information.
5. Do delayed EMI payments attract any fee?
Delayed repayment is chargeable and attracts 24% or less as fee over an annum
6. How long does it take the home loan closure to affect my CIBIL score?
It takes 3 months from date of closure for credit score to be affected.
7. After how long will the bank share my credit score update with me?
The Jammu and Kashmir bank will share credit score after a month from its update.
8. Can I download the amortization sheet from J&K bank’s website?
You may be able to download the amortization sheer on home loan closure from the website later to a month of loan’s expiry or its closure.
9. Will the bank bear any responsibility if my house’s property deed is damaged during courier service?
The Jammu and Kashmir bank will take no responsibility if the property deed is damaged during transit via courier.
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