You need to submit an estimate of the total cost of construction,certified by an architect or a civil engineer. The cost of the plot or the current market value,whichever is lower,will be taken into account to calculate the total cost of the project,provided you commence the construction within a reasonable time after the purchase of the plot. The bank will decide the home loan amount based on the total cost,comprising of the construction cost and cost of the plot. The loan will be released in parts,based on the progress of the construction,and after you have brought in your full margin. The bank may insist on sending its own technical personnel to assess the progress of construction or may rely on certificates/photographs submitted by you. Some banks are not comfortable funding self-constructed properties and hence,you will need to take this into account while finalising your lender.

Can I switch jobs or become self-employed during the tenure of a home loan?

Sujit Roy,Kolkata

Yes,you can. However,you may have to keep the lending bank informed of the changes as it is a part of the terms and conditions agreed by you. Also,if your repayment happens by way of deduction against salary,you have to get your new employer in the loop. Or else,arrange for an alternative payment mechanism to ensure that you do not default.

Can I take a home loan from a relative? What documents do I need for that purpose?

Sumita Patil,Mumbai

You can take a home loan from a relative and claim tax deductions benefits for interest payable on the loan up to Rs 1.5 lakh only. No deduction is available for principal payment under Section 80 C. If required,during the assessment proceedings you will need to provide proof for the loan and its utilisation for the purpose of acquiring the house You will need a certificate from the relative for tax deduction purposes.

Harsh Roongta,CEO,

apnapaisa.com

For queries,please mail us at estatesexpressindia.com