Housing Loan limit under priority sector increased to 25 lakhs

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Housing Loan limit under priority sector increased to 25 lakhs:
This move by RBI has given boost to housing sector but in a place like Bangalore and other metros 25 lakhs is still less. There is a need to revamp on the rate of interest on housing loan segment which keeps fluctuating with every measure of RBI to control inflation. The housing loan taken at 8%PA will become 14% PA and even higher in some cases
RBI/2010-11/517
RPCD.CO.Plan.BC.69/04.09.01/2010-11
May 9, 2011
The Chairman/Managing Director/
Chief Executive Officer
[All Scheduled Commercial Banks (excluding Regional Rural Banks)]
Dear Sir/ Madam,
Housing Loan limit under priority sector
Please refer to paragraph 6.1 of our master circular RPCD.CO.Plan.BC.10/04.09.01/2010-11 dated July 1, 2010 on lending to priority sector, wherein loans up to Rs.20 lakh irrespective of location, to individuals for purchase / construction of dwelling unit per family, excluding loans granted by banks to their own employees are eligible for classification under priority sector.
2. Pursuant to the announcement made by Union Finance Minister in paragraph 44 of the budget for the year 2011-12, it has been decided to increase the above limit from Rs.20 lakh to Rs.25 lakh.
3. The above change will be applicable to housing loans sanctioned on or after April 1, 2011.
Yours faithfully,
(A.K.Misra)
General Manager
 
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