Housing loan limit for urban cooperative bank hiked to Rs 30 lakh

The Reserve Bank on Monday raised the cap on individual housing loan. An urban cooperative bank (UCB) can now disburse to Rs 30 lakh from Rs 25 lakh. The central bank also raised repayment period for such loans to 20 years.

The housing loan limit for another category (tier-II) UCBs has been increased to Rs 70 lakh from Rs 50 lakh, RBI said in a statement.

"As announced in the Second Quarter Review of the Monetary Policy 2011-12, it has been decided to permit tier-I UCBs to extend individual housing loans up to a maximum of Rs 30 lakh per beneficiary of a dwelling unit and tier-II UCBs to extend individual housing loans up to a maximum of Rs 70 lakh per beneficiary of a dwelling unit subject to extant prudential exposure limits," it said.

It has also been decided to enhance the maximum repayment period of housing loans granted by UCBs (including the period of moratorium or repayment holiday) from the present period of 15 years to 20 years, it added.

The RBI in the half yearly monetary policy review last week had said "...it is felt that there is a need to increase the maximum permissible limit of individual housing loans that can be granted by the UCBs, as also to increase the maximum repayment period for such loans".