Sunday, September 18, 2011

Repayment of Housing Loan avaialed by an NRI by Close relative of such NRI in Indian Rupees- Now Allowed under automatic route

The housing loan provided to a non-resident Indian or a person of Indian origin resident outside India by an authorised dealer or a housing finance institution in India approved by the National Housing Bank for acquisition of a residential accommodation in India, may be repaid by any relative of the borrower in India by crediting the borrower's loan account through the bank account of such relative (relative as defined in section 6 of the Companies Act, 1956). Thus, repayment of loan by close relative in respect of loan in rupees availed by NRI is restricted to housing loans only.

Such housing  loans availed by NRI  may also be repaid by resident close relative (relative as defined in Section 6 of the Companies Act, 1956), of the Non-Resident Indian by crediting the borrower's loan account through the bank account of such relative.

The Reserve Bank of India has allowed resident individuals torepay housing loans in rupee on behalf of their close relatives, whoare non-resident Indians (NRIs) or People of Indian origin (PIO).
"..It has been decided that where an authorised dealer (bank) in Indiahas granted loan to a non-resident Indian..., such loans may also berepaid by resident close relative of the NRI by crediting the
borrower's loan account through the bank account of such relative,"

However, this repayment facility is restricted to housing loan only,

Ref:RBI/2011-12/183  A.P. (DIR Series) Circular No. 19 dated 16 September 2011

2 comments:

  1. Thank you for sharing such great information.It is informative, can you help me in finding out more detail on housing loan for nri,i am interested and would like to know more about the rates.

    ReplyDelete
  2. Thank you for sharing such great information.
    It is informative, can you help me in finding out more detail on
    home loan for nri.

    ReplyDelete