Mortgage Loan Products Of HDFC

	Product	Interest % p.a.	Capital grace period	Total repayment Period	Borrowers Equity
1	HDFC-SL Standard Loan Up to Rf. 1,000,000/=	11.75	1 year	15 years	20%
2	HDFC-MP   Million Plus More than Rf. 1 million	12	1 year	15 years	20%
3	HDFC –PR Part Rental (more than 1/3rd of built area given on rent)	12	1 year	15 years	30%
4	HDFC-FR Full Rental	13	1-2 years	15 years	30%

General Features:

i) HDFC-Standard Loan will consider rental income of up to one third (1/3rd.) of the built area. If the rented area is more than 1/3rd of the built area, the loan will be considered under HDFC- Part Rental category provided at least a single unit of housing is deemed as owner-occupied.

ii) HDFC- Million Plus- The same condition on rented area in (i) above shall apply with a change in the interest rate to 12%.

iii) HDFC Part Rental Loan will consider owner occupied property with more than one third of the built area made available for rental income.

iv) HDFC Full Rental where no owner occupation is involved and designed for one hundred percent rental.

v) Customers’ repayment capacity is determined using the Equated Monthly Installment (EMI) to Monthly Income (MI) Ratio as follows:

MI Range (In Ryfiya)	EMI/MI (%) (Inclusive of all fixed loan installments)
Less than 6,000.00	20%
6,000.00 to 10,000.00	25%
More than 10,000.00	40%

vi) All properties used as mortgage security should have a market value for determination of adequacy for a minimum of 125% loan cover.

vii) HomeSaver Scheme is there to help customers who do not qualify for a home loan as they do not have the required equity (given in the last column of the table on mortgage products above). Under this scheme customers could pre-apply to purchase or construct a property to a determined value and start saving towards the required equity to secure the loan. The application will become active on fulfillment of the equity. The HomeSaver account holders will receive an attractive savings rate during the period of building up the equity requirement.

viii) HDFC Home Loan Counseling Service is available to all customers to determine their eligibility.

ix) The customer must undertake to pay to the relevant authorities, any applicable fees and stamp duties for the execution of the mortgage and loan agreement.

x) Before the initial disbursement of the home loan:

• In accordance with the loan agreement, customer must deposit a sum equivalent to three monthly installments in a loan-linked savings account called DEMI (Deposit Equated Monthly Installments) maintained at HDFC until complete repayment of the loan.
• Property Insurance with a reputed Insurance Company approved by the MMA to cover in full, the construction phase/completed property (annual insurance premium paid by the customer to maintain an active policy throughout the loan period).
  

 

 

Loan Application Process

Step 1: Application:
 
Customers are advised to avail themselves of HDFC Home Loan counseling service to determine their eligibility for a home loan.

Step 2: Application:

The main applications will be the current/intended legal title-holders to the property, and co-applicants should have either a legal claim of inheritance or a legal relationship with the main applicant/co-applicant, and be on or above 18 years of age. The Application Form is available for purchase from HDFC for Rf. 25/-. Clarification and assistance in completing the forms would be provided by HDFC where required.  Complete and submit the Application Form to HDFC. The information in the form of documentary evidence required would include:

1. Joint-applications are encouraged, but in the event circumstances warrant only an individual applicant, a guarantor or guarantors willing to act with a legal personal commitment to the loan should be included with all information relevant to a co-applicant
2. Copies of National Identity Cards of all applicants/guarantors
3. Value of purchase/ Costing of proposed investment or the Bill of Quantities (BOQ)
4. Legal title documents (copies)
5. Proposed construction methods and arrangements 
6. Permits and approved drawings
7. Source and amount of income of the applicants with authenticating documents
8.  Bank statements for the past twelve months
9.  Credit history of the applicants (copies of documents on previous loans taken)
10.  Availability of down payment and/or customers’ equity
11. Rent/ Lease agreements relating to either the income or property in the loan application
12. Other relevant information depending on the proposal 

Step 3: Loan Application Review:

1. A Credit Officer will review the application, and applicants will be requested to visit HDFC in-person for an interview. During the interview, the proposal would be reviewed along with the applicants who should provide all information relevant to the criteria of eligibility. Any incomplete documentation should be provided within 14 days to keep the application active.
2. When all the required information is received and documentation is completed, HDFC would undertake site visit, take photos, and assess the property. The Credit Officer assigned to the credit file would evaluate the loan, and compile the Credit Report for presentation to the Credit Committee.

Step 4: Loan Approval: 

1. The Credit Committee reviews the Credit Report presented by the Credit Officer including supporting documents and other relevant facts, and would either approve or decline the credit facility. Before communicating the decision to the customer, HDFC’s Internal Loan Audit would review the documentation to ensure that proper procedures were followed by the Credit Committee in arriving at its decision.
2. Successful applicants are informed with an offer letter, requesting acceptance of the loan offer in writing, along with the payment of the processing fee of 0.25% of the approved loan amount within 14 working days.
3. Unsuccessful applications are advised in writing as to why the loan is not approved on this occasion.
4. HDFC encourages applicants to appeal against any of its decisions directly to the Appeals Committee of the HDFC chaired by the Managing Director.
5. Customers may also request for a meeting with either the MD or a local Director to discuss and / or clarify any matters regarding loan applications and proposed projects. HDFC would facilitate such appointments within 24 hours of the request. 

Step 5: Acceptance of Loan Offer:

1. Once the HDFC receives the Letter of Acceptance, payment of the processing fee, original title deed of the property, revenue stamp duty, existing loan confirmation form, Funds Drawdown Schedule in line with the approved Work Plan, and contractor agreement from the customers, the Legal Department shall make necessary arrangements to execute the mortgage and loan agreement documents.
2. The Legal Department would then obtain a date from the Civil Court and inform the applicants.
3. The Loan/Mortgage Agreement would then be signed and registered in the Civil Court, and completion of mortgage registration over the title of the property shall be duly executed by the Male’ Municipality.

Step 6: Disbursement of Loan Funds:
Once the Loan Agreement is signed and mortgage of the property is completed:

1. Customers must deposit three months EMI (DEMI) with the HDFC in accordance with the loan agreement before the first disbursement. The customer may deposit one EMI and request structuring of disbursements for the balance EMI credits to the DEMI account. DEMI account shall act as a buffer to be maintained until the total redemption of the loan.
2. Customers must either pay the property insurance premium through the HDFC or submit an insurance policy document acceptable to the HDFC
3.  HDFC would disburse loan funds in accordance with the approved Funds Drawdown Schedule following inspection and after receiving clearance from the HDFC inspection report.

Step 7: Loan Repayments:

a) Repayment date- This is the ‘due-date’ stipulated in the loan agreement that should be strictly observed.

b) Late Payment Fine- Failure to meet this due-date deadline will entail a fine in the form of an additional 10% charge on the Pre-EMI or EMI amount due and unpaid.

c) Pre-EMI- During the capital grace period up to one year/or complete drawdown date, whichever is first for construction loans, the customers will be levied with simple interest on the disbursed funds payable monthly. This is identified as the Pre-EMI (Pre-Equated Monthly Installment) stage, and the customer shall pay the Pre-EMI on or before its due-date.  
 
d) EMI- Once the drawdown/grace period is over, the customer shall pay the EMI on or before the due-date.

e) Method of Repayment-Customers may affect monthly repayments as follows:

• Deducted and paid from the salary through the employer
• Direct Debit from the borrower’s account to HDFC’s account at Bank of Maldives individually, or through a Standing Order
• Payment of cash and cheques at HDFC

f) Excess Capital Prepayments and/or Pre-settlement of the loan- In view of the mutual commitment to the transaction with the HDFC, the management reserves the right review the circumstances and impose a commitment fee, minimum of 2% of the settlement figure.

 

Advise for Servicing Your Home Loan without Defaults

All home loans granted by HDFC are secured with a mortgage. The Loan Agreement is registered at the Civil Court and the mortgage is registered over the title of the property at the Male’ Municipality. If any customer is delinquent by failing to meet the monthly repayments leading the overdue period to exceed three months, HDFC may cancel the loan, and through legal representation, demand the borrower to pay the total outstanding loan balance in one lump sum. If the borrower fails to meet this demand, HDFC may take legal action to liquidate the security by legal possession and sale under the terms and conditions of the loan and mortgage agreement, and prevailing legislative powers in the Maldives.