I have purchased a site on Anekal Jigani road (6KMS from PAC Circle) on loan. Is there a rule to construct house?

Q: As mentioned, I have purchased a site on Anekal Jigani road (6KMS from PAC Circle) on loan. Is there a rule that if we purchase a site on Bank loan we should construct house within a stipulated time frame? When checked with the Axis Bank from whom i have taken the loan, they informed me that as per new RBI rule we have to construct house within 18 months of site purchase. Currently i cannot construct a house there for another min of 5 years as the area is not developed. Please advise if i have sell the site or keep it.

Thanks,
Vishwa

Tejas,

17th April 2014

Legal in Jigani, Bangalore

Follow Discussion

Also see discussions for

Bangalore Jigani Legal Legal in Bangalore Legal in Jigani

Replies (3)

Good evening Tejas, this rule is not apply to LIC because they provide Plot loan for the period of 10 years, and you can build your house anytime you want. but sorry i dont know anyone personally from LIC. but you can visit the nearest branch or enquire online about this with them. Thanks

Aravind Kumar, Apartment Resident

23rd April 2014

Comment

Nice information. I contacted the LIC agent and they confirmed the same.. however, if i transfer now my EMI would go high which i would not be able to afford due to other commitments. Hence will look into this option in future.

Thanks,
Tejas.

Tejas,

24th April 2014

Yes Tejas, Sree Potamal is right. if you brought a property loan then you have to start construction so you can check with LIC guys because they are providing Plot loan and if possible you can transfer the loan from AXIS to LIC. visit the nearest LIC office to get more informtaion on this.

Aravind Kumar, Apartment Resident

22nd April 2014

Comment

Thanks for your inputs Aravind. Will this rule not apply for LIC? Do you know anyone from LIC who can help me on this.

Tejas,

23rd April 2014

Hey Tejas, If you are buying a property on loan then there is a time frame set by the bank that you have to construct a house in that time frame. If anything such is mentioned in the documents then you have to build within the given time period.. Once you can talk with the bank people in this matter and check if you have to pay anything for not construction the house and keep the site empty for another 5 years.

Sree Potamal, Bangalore

21st April 2014

Comment

Thanks for your Potamal :-) I did check with the site agent and he mentioned that i have 2 options. 1. to construct a house 2. If i do not construct there will be a 1% increment in the interest rate of rest of the tenure. Not sure if this holds good. Please advise. If thats the case should i retain the site or sell off. As mentioned I cannot construct house as the area is not developed at all and there is not even a single house in the layout. However, the layout is very good investment i feel. Not sure. Please advise.

Tejas,

23rd April 2014

Tejas, if they are asking 1% increased interest rate for rest of the tenure i think it is a good option for you, because if you sell your site now you won't get more hike and Anekal jigani is upcoming super areas in south bangalore, 300 feet STRR road coming near anekal and Metro also propsed in both Bannerghatta road as well as Hosur road and more over Surya city phase 3 and phase 4 coming near to that area so if you manage to keep your site for next 5 to 10 years surely you will get 3 to 4 times more money what you have invested now. thanks

Aravind Kumar, Apartment Resident

23rd April 2014

Thanks for your inputs.. Its been very helpful. I had visited the bank and checked with them. They have taken a written letter with my concern and said as of now there is no change and they would keep me informed in case of any such changes. I am very much relaxed now...

Thanks,
Tejas.

Tejas,

24th April 2014

All the best Tejas :) i hope and wish you may start the construction soon and have your dream home.

Aravind Kumar, Apartment Resident

25th April 2014