BANKING: Prashant Joshi

I want to take a home loan to buy land. This land parcel is outside my city limits and categorised as non-agricultural. I intend to construct a holiday home after some years. Will I get a home loan for this purpose? What is the loan-to-value ratio that I can expect?
A home loan for the purchase of a plot outside city/ municipal areas is a tough proposition, as many lenders do not lend for this purpose. The construction of a holiday home is also outside the purview of most lenders and, hence, getting a home loan for the stated purpose would be difficult. In case a lender considers the proposition, the loan-to-value ratio will be low. You can expect it to be lower than that for home loans, approximately 60-70 per cent.

I am a retired person. I received a big amount as provident fund money which I want to invest in a fixed deposit. I was told that I need to provide Forms 15G and 15H to the bank. What are these forms?
Forms 15G and 15H have to be submitted to a bank when two conditions arise. One, if the interest income on your fixed deposits exceeds Rs 10,000 per deposit per branch in a financial year. Two, if you overall income for the financial year is below the taxable limit (Rs 2.2 lakh for retired persons).

By providing these two forms, you can ensure that the bank does not deduct any tax at source on the interest income accrued on your fixed deposits. Form 15H is specifically meant for citizens over 65 (considered as retired, as per the Income-Tax Act) and whose income in the previous assessment year was nil.

My company has employed me on a three-year contract. This contract is most likely to be renewed after the specified period. I have recently approached a bank for a personal loan. However, there has been a lot of delay. I want to know, if banks lend to contract workers?
Banks generally refrain from extending credit facility to contractual employees. This is because of the short time frame of the contracts. However, in specific cases, where the contractual employee is accorded all the benefits of a permanent employee by the company, an exception can be made.

Prashant Joshi is managing director & head, private & business clients (India) of Deutsche Bank.
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