Q: Hi, I own a plot and want to construct a house. it has been 15 years of me working and I want to withdraw money from my Employees provident fund ( EPF). How can I do this?
Banks like SBI, Axis Bank, HDFC Ltd, ICICI Bank, etc, can be applied for a construction loan. As a thumb rule, if you are below 40 years, you should be eligible for around four times your net annual income as a loan of 20 years tenure. If the loan amount is below 30 lakh, the rate of interest will be in the range of 10% to 10.25% per annum.
No Sunil, construction loan can't be taken out in one go.. It can be availed in parts depending on the progress of the construction. However, you will have to bring in your contribution in full before the lender disburses the loan.
I agree with Mr Rakshit.. But firstly, you have to submit an estimate of the total cost of construction, duly certified by an architect/ civil engineer. Then you can take out a construction loan for constructing a dwelling unit on a piece of land already owned by you.
The provident fund which is provided by the organisations is for your future and will help you after retirement and hence should not be touched except in an emergency. In any case, PF with drawals are available only after five years and for specified purposes like acquiring a house or construction of a house. You have to submit the application form for withdrawal from your EPF along with the original title deed for verification, non- encumbrance certificate, estimated cost of construction and approved plan.