A comprehensive guide for Non-Resident Indians looking to invest in the rapidly expanding landscape of Dholera SIR.
Lenders in India will be more than happy to fund your project provided you meet their eligibility criteria and property papers are clean. It is always advisable to get the property papers verified by a lawyer before going ahead and finalizing the deal.
Also a no due certificate should be obtained from the authorities to cross check that all the bills like water, electricity etc. are completely paid. For new constructions, land title should be clear.
Kindly note: Only a graduate NRI can avail home loans in India under current regulatory frame routes.
As indicated by RBI standards, a maximum of 80% of the estimation of property can be financed by a financial institution. Rest has to come from the NRI’s personal resources. Indian financial institutions give loans in rupees so the same needs to be repaid in rupees only.
Since all transactions must happen through the banking channel, repayment has to be done by inward remittances. You can directly get the money remitted from NRO/NRE account in India or issue post-dated cheques or Electronic Clearance Service (ECS) from your NRE, NRO or Foreign Currency Non Resident (FCNR) account.
In case you let out the property you can use the rent to repay the loan as well. Cheques issued from a relative’s local account can also be used to make the loan payments.
If you are buying an under-construction property, your developer may ask for a power of attorney (PoA) favouring them. This is not unusual and would make documentation work slightly easier and quicker.
Also, if and when you want to dispose the property, it is a good idea to have a PoA to be a resident India who may be able to act on your behalf to complete formalities such as registration, possession, execution of agreement of sale, etc.
Under the FEMA rules, if you are an NRI, you can sell any residential or commercial property you have bought or inherited to anyone you want. If you have any inherited agricultural property, plantation or farm house, you have to search for a resident Indian to buy it.
However, you are allowed to gift them to another NRI or the person of Indian origin. There are some specific RBI guidelines on the repatriation of sale proceeds which need to be adhered to.
A property is also a good tax saving tool for both residents and non-residents. The benefits for a non-residential Indian (NRI) are very similar to the tax benefits of a resident Indian.
An NRI is entitled to all tax benefits related to purchase of property that a resident Indian is. So, you can claim tax deductions under section 80C guidelines safely.
