Home loan for construction on a plot with B khata

[sk1976]

All,
I came to know that some housing finance companies are issuing home loans for construction on a 'B' khata sites. Since the plan is not approved by BBMP, They are charging a risk margin of 1% above the normal home loan interest rate. They will waive the 1% upon submission of A khatha and BBMP approved plan. Since I have waited for many years for this 'A' khatha and there seems to be no end to the Akrama-Sakrama legal issues, This loan option seems to be of help for people who desperately want to construct home on 'B' khatha sites. Ofcourse the construction becomes unauthorized from BBMP perspective even though these HFCs issue the loan, so you should be aware of all the issues that come up during and after construction. You could enquire HFCs like Repco Home Finance (in Mittal tower 1st floor) MG road or others like LICHFL or DHFL if you are desperate for the loan and can handle all the other risks. But do your homework and ask them for all their hidden charges(processing fees, prepayment, foreclosure charges) before you hand over the processing fee/sign the agreement.

Regards,
Selva

[panandh]

Thanks for the info. I was planning to purchase a plot with "B" khata. I will check with these HFCs.

Anand

[eswarao_k]

Dear Anand,

I think if building/flat is B khata and land is A khata it may be safe to buy. However if land is B khata, then please careful. I would suggest not to go ahead.

There are huge number of BDA and BMRDA sites available. Go for that. Price is high but its 100% safe.

[panandh]

Thanks for the reply. I dropped the plan of purchasing B khatha. The more information I gather, the more clarity I get.