Normally the lenders will ask you to create a registered mortgage deed on the property which they will retain with them as a security against your loan. As this is a legal document, the prevalent stamp duty needs to be paid to the State Govt. In the state of Maharastra, this duty is about Rs. 5000 for a loan below Rs 5 lacs and about Rs. 35000 for a loan above Rs 20 lacs. Some lenders like HDFC do not ask for the Registered Mortgage Deed but only take the original Title Papers of the property as a security. Thus customers of HDFC do not pay the stamp duty to the respective State Governments.

Some States have taken this matter to court as they are losing revenue. Some of the lower courts have ruled in favour of the State Governments and asked HDFC to make good the Stamp Duty for all past customers along with interest. The matter is now pending with the Supreme Court. We feel that the ruling will again go in favour of the States. We are not sure if HDFC would be asked to pay up a large amount along with interest, which may ultimately be passed on the the existing customers. Any new customers going to such lenders must be aware of the risk of a legal ruling that may result in a future cash payment along with interest.

Flexible Loan Repayments

If you are a salaried employee, banks look at your current salaries while deciding how much they can lend you. The fact is that your salary can only increase as time goes by and your ability to repay larger loan amounts will only get better. Some banks now offer a flexible repayment plan that allows you to pay larger portions of the loan in the later years. Your initial monthly payments are kept low. IDBI Bank, HSBC and Citibank offer Flexi repayment option loans. To read more about this click below.

Tips for Buying Property

1. Invest your hard earned money in projects promoted by renowned developers having proven track record. Do not go by glossy brochures or attractive advertisements. Do not believe the words, 'Financial Institutions approved Projects'.
2. Check up the documents with an experienced Advocate. Ensure that the documents of title of the property you intend to purchase are clear. Defective title will create problems at any point of time.
3. Always go for a property, which has a resale value.
4. Ensure that the building has been constructed as per the sanctioned plan and if any deviation in the allowed limits. It is not in a low-lying area or in a filled up water body.
5. You may always rope in the services of a reputed real estate agent and fix his commission well in advance.
6. Purchase the property in a developing area. The value of land will appreciate.
7. If you prefer a ready-to-occupy Flat, locate it off the main road on a wide street with adequate water supply away from slums, cinema hall, marriage hall, open drain, factories, and place of worship but not very far from school, college, commercial complex, temple and hospital.
8. If you buy the flat/building under construction, visit the work site regularly and see the work progress.
9. You may not be a Vaastu believer, but purchase house or flat or land that is Vaastufriendly from resale point of view.
10. If any one offers flats/sites for a cheaper rate than the prevailing market rate; there may be certain hidden problems. So you should be extra-ordinarily careful on finalisation of such a property.
11. Ensure that the developer has Clearance Certificates from government departments viz., Electricity Board, Water and Sewage Board, etc..
12. Commencement Certificate and Occupancy Certificate are other important documents that are necessary while buying the flats.
13. Check up the genuineness of the documents with the concerned authorities in person.
14. Ensure Agreement for Sale and Sale Deed, duly stamped, executed and registered are in your possession. Both should contain fair clauses for both the parties.
15. In case of flat purchase, specification of the building, including material used, difference between the carpet area and the super built-up area are the important factors to decide the rate. Other facilities like Club House, Swimming Pool etc., also will have to be considered.
16. Check whether there is adequate water supply and sanitary line facility.
17. Get pre-approved for a loan. This way you'll know if you can get approved and how much you can spend on a house. It also puts you in a stronger position when you ultimately make an offer on a house
18. Determine how much cash you'll have available for a down payment and closing costs (points, which are extra fees paid to secure a lower interest rate), origination fees, taxes, title insurance, and financing costs). The higher your down payment, the lower your monthly mortgage payment and the possibility of qualifying for a better loan
19. Gather your paperwork -- recent pay stubs, tax documents for the past two years, bank account statements, etc.