turr rys 6q 16 ,dt +ttr{-t d rsfd PUNJAB & SIND EANK

(grla Fa6R 6r3qfi'fr) {A Government Of lndia UndertakinS)

H.O. Hum.n R€saur.es Dev€lopmen! Depit.
E.6r. aElq {€IqiT f6'r{ fumr
5th floor, Bank House,
t*
6
qia-ar aa. #rq. 21, Ratendra Place, New Delhi- 110006
21, {rfa dfr, dg ftia&- rroooe
Phone: 011-25716407
EISFI : 011.257161t07
E-mail: ho.hrd@psb.co.in
f,fi: ho.hrd@osu.co.in

Annexur€ A

MASTER CIRCULAR ON HOUSE BUILOING ADVANCE TO STAFF OF THE

BANK

INDEX
ITEM PARTICULARS PAGE NO.
NO.
GUIDELINES AND TERMS AND CONDITIONS
1. PURPOSE 2-3
2. ELIGIBILITY 3
3. MARGIN
4. PROJECT COST CEILING 3-4
5. QUANTUM OF LOAN 4
6. PERMISSIBLE AGE LIMIT
7. REPAYMENT PERIOD 5
o. RATE OF INTEREST 6
9. SANCTION AND OISBURSEMENT OF ADVANCE 6-7
10. TIME LIMIT FOR UTILISATION OF ADVANCE 7
1,1. CONSTRUCTION 8-9
12. REPAYMENTOF ADVANCE 10
13. SUBSTITUTION OF SECURITY 10
14. HOUSE BUILDING ADVANCE TO STAFF NEMBERS WHERE 11
HOUSE/ SITE' PLOT IS IN THE NAME OF SPOUSE
15. SANCTIONING AUTHORITY 11
.16.
PROCESSING & OTHER CHARGES 11
17. LOAN FOR REPAIR AND RENOVATION 11-12
18. REGISTRATION CHARGES 12
't9. PERMITTING EMPLOYEES TO ACOUIRE 2NO HOUSE WTHIN 12-14
THE OVERALL CEILINGS UNDER STAFF HOUSING LOAN
20. TAKEOVER/ CONVERSION OF EXISITNG HOUSING LOANS 14
OF EMPLOYEES
21. GENERAL CONDITIONS 14-16

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#ry Pate 1of 15

 HOUSE BUILDING ADVANCf, TO STAFF OF THE BANK

PURPOSE

construction of
dwellino univs as defined below:

Details given as below:

Acquiring a residential plot and constructing house thereon singly or
jointly with spouse (as co-borrower)

B Constructing a new house on the plot already owned by the offlcial/

his/her spouse orjointly with his/her spouse.

c Getting a plot under cooperative Schemes and building a house where

title will vest on the staff member/ jointly with hislher spouse (as co'
borrower).

D Enlarging living accommodation in an existing house owned by the

official or jointly with spouse (as co-borrower) subject to the overall limit
prescribed under the scheme.

E Conversion of hire purchase into outright purchase of house/ flat from

State housing Boards or similar Govt. controlled bodies and outright
purchase of new ready built house or flat from Govt., Semicovt or
local bodies, Housing Boards, development authorities etc and from
private parties.

F Purchasing of house/flat under self financing housing scheme and

cooperative Group housing societies.

G For Purchase o, Flat from Society/ Builder

H For purchase of Built up dwelling unit

Repayment of loans taken from other banks/Fls for house construction
even if construction has already commenced
J Construction of the residential portion of the building on a Plot
which is earmarked as a shop-cum- residential plot in a residential
colony in the name of the employee or iointly with spouse as co-
borrower.

K Repairs, renovation, improvement of existing pre-owned house or flat in

the name of the employee or jointly with spouse.

Pate 2 of 16
 HOUSE BUILDING ADVANCE TO STAFtr OF THE BANK

L Purchase of second dwelling unit or construction of second dwelling

unit on pre-owned plot by the individual staff members who have
akeady availed HBA from the bank, may be permitted subject to the
overall limit prescribed under the scheme, repaying capacity and that
he/she fulfills the other eligibility criteria for the proposed facility.
Note:
Purchase of revenue sites (such as, land classifisd as 'agriculture'
or'non converled'9ite9 etc.) and/or construction thereon cannot
be tinanced under the Scheme

2. ELIGIBILITY

The Officers/Award staff who have completed '1 year of continuous

service in the bank or on their confirmation in the bank, whichever is
later shall become eligible for avaaling House building Advance.
ii) The part time employees who are confirmed in the service of the Bank
and fitted with time scale of wages are eligible for housing loan under
the housing loan scheme applicable to the Sub-staff of the Bank.
However, the maximum amount of loan payable to such employees
shall be in proporlion of the scale wages drawn by them.
iii) Loan will be available in the name of the employee or jointly lvith
spouse.
iv) A bank employee on deputation to a department or on a foreign service
will be entitled for HBA from his/her parent bank only.
v) Ordinarily Officers under suspension or against whom major
disciptinary proceedings are initiated would not be eligible for HBA.
However, competent authority, depending upon the gravity of the case,
may sanction HBA to an officer against whom disciplinary proceedings
are pending, subject to the condition that the officer will be required to
turnish sureties from two permanent officers of the bank.

3. MARGIN
10% of the project cost of purchase (purchase ol built up univpurchase of plot +
construction)/ construction/ enlargemenU repair/ renovation, as the case may
be.

4. PRoJEcT coST cEILING

The cost ceiling (in case of Officers) for availing housing loan has been
discontinued. However, where the cost of the project is over and above the
proposed limits of House Building Advance, the concerned staff member shall
clearly indicate to the satisfaction of the sanctioning authority, the sources
through which the pOect cost shall be met over and above the HBA. Loan
Sanctioning / Distributing Authority shall ensure that the take home salary of
the staff should not be less than 40% of the employee's net salary.
I s;,. . PaEe I of 16
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 HOUSE BUILDING ADYAIICE TO STATF OF THE EAI'K

5, QUANTUM OF LOAN

For Olficers Clerks Sub-staff/

(Scale I and above) Full time
Scale Scale lV & Scale I to Scale Sweeper
vt &vI l
Construction/ 70.00 50.00 50.00 35.00 lacs 20.00 lacs
Purchase of lacs lacs lacs
House/ FlaU
Enlargement PTS (3/4'" of scale of pay) 15.00 lacs
PTS ('ll2 of scale of pay) 10.00 lacs
of existing
PTS (1/3d of scale of pay) 6.66 lacs
premises
Repair/ Officers Clerks Sub-staff/ Full time
Renovation/ (Scale land above) Sweeper
of existing
premis€s
10.00 lacs 6.00 lacs 4.00 lacs

6. PERMISSIBLE AGE LIMIT

The maximum permissible age for repayment at the time of sanction of staff
Housing Loan may be considered upto 70 years for all eligible employses
(Pension optees, PF optees, employees those who are drawing other
pensions such as Defence and employees covered under New Pension
Scheme (NPS)) subject to maximum permissible repayment period and
oth6r eligibility criteria under the scheme.

Provided further the retiring employee shall give an undertaking to keep

depositing the monthly instalments and maintain 30% of the Net take home
income (after superannuation) during the pendency of the loan liability

The concerned branch to ensure that outstanding loan at the time of his/her
superannuation can be recovered from the employee's future income i.e.
pension/other source of income, if any. Accordingly, if needed part of loan has
to be recovered in lump-sum out of terminal dues.

Further, for PF optees and employees covered under NPS, extension of

permissible age limit upto 70 years shall be subject to the following additional
conditions:

(a) For PF Optees

The employee will be required to submit a collateral security in the form of

FDR amounting to the entire loan liability (including principal, interest)
outstanding on the date of superannuation. ln case of cessation of income the
loan liability at that point ot time will be adjusted from collateral security

Page 4 of 16
 HOUSE BUILDING ADVAI\CE TO STAFF OF THE BANK

i.e FDR. Further, such FDRS duly discharged by the employee must be got
issued from the same branch, where housing loan is being maintained for the
remaining period of repaymenucurrency of Loan outstandlng.

(b) For employees covered under NPS:

i. The employee is required to maintain his/her savings bank account

with our bank even after his/her retirement and NPS lump sum
withdrawal and NPS annuity should be credited to the said account.
ii. The repayment of loan should be through the same account.
iii. The employee shall submit an undertaking to credit the NPS lump-sum
withdrawal and NPS annuity through Bank's savings bank account.
Further, the employee will undertake to maintain sufficient balance in
the said account to enable the Bank to recover the monthly instalments
towards outstanding Housing Loan through the same account.

ln case of staff leaving services of the Bank other than superannuation i.e.
CRSA/RS/Resignation/Cessation of service etc. the account shall be adjusted
or converted to General Public Scheme from the date of such event, subject
to his/ her eligibility. ln case of death of employee, house loan under HBA is
outstanding the liability shall either be repaid out of superannuation benefits of
the employee or the legal heirs shall have option to convert the outstanding
into General Public House Loan in case their income (including pension
benefits) and repaying capacity are suffrcient on the date of such conversion.

7. REPAYMENT PERIOD

The loan together with interest thereon shall be repayable in not more than
360 monthly installments (30 years). However, the employee may opt to repay
in a shorter period.

The amount of Principal should be recovered in 270 monthly instalmenis

and the amount of interest should be recoversd in rsmainlng 90 monthly
instalments i.e. in the ratio of 3:1 by refixing the instalment for accumulated
interest and full and final adjustment of loan account. For the loan with lesser
tenure the computation shall be done on pro rata basis and the loan amount
(Principal + lnterest) shall be liquidated maximum upto the age of 70 years
(refer to Clause 6 ofthe scheme).
8. RATE oF INTEREST
Officer Staff
Upto Rs. 40 lacs 8% per annum (simple)
More than Rs.40 Lacs to Rs. 70 Lacs 9% per annum (simple)
Award Staff 8% per annum (simple)

Page 5 of 16
 HOUSE BUILDING ADVANCE TO STAFF OF THE BANK

9. SANCTION AND DISBURSEMENT OF AOVANCE

i) For enlargemenUconstruction/ Repair/ renovation

Disbursement of installment is to be related to the progress in the
construction of the housing unit. However, where individual land
documents are available, equitable mortgage should be essential
before disbursement of the loan. This should be subject to legal
opinion to be furnished to the sanctioning authority.

ii) For purchase of plot and construction

a) Bank linance shall be provided for complete dwelling

unit including purchase of plot by resale/market and
for construction thereafter (i.e. cost of plot + estimated
cost of construction). The loan for acquisition of land
shall not exceed 60% of the loan sanctioned (under
the scheme) or 90% of the actual cost of the plot
whichever is less.
b) The disbuEement may be released in phases i,e. for
the purchase of plot first and construction later on.
The loan amount for consiruction shall be disbursed in
stages based on the progress of construction.
c) The employee would have to construct the house
within 2 years from the date of purchase of the plot.
The extension of period from 2 to 3 years may be
considered on case to case basis, subject to
stipulations of concerned local body, it any in this
regard. The General Manager (Advances) will be the
Sanctioning Authority to consider extension of period
from 2 to 3 years on case to case basis. ln case GM
(Advances) has approved the original sanction, GM
(HRD) shall be the sanctioning authority tor extension
of period from 2 to 3 years.

iv) For purchase of ready built house

ln one lump-sum payment
v) For purchase ol house/flat from cooperative Group Housing
Societies:

For the purpose of house/flat from cooperative group housing

society disbursement of loan within the sanctioned limit may be
made in the light of demands made by the co-operative group

Page 6 of 15
 HOUSE BUILDING ADVANCE TO STAFF OF THE BANK

housing society, subject to obtention of mortgage as early as

possible.
vi) For Purchase of Flat from Societyl Builder
The loan amount will be disbursed in stages based on the
demand raised by the Society/ builder. The Branch Manager
to verify terms ol agreement between buyer/ builder
accepted by bank at the time of sanction. The progress of
construction as detailed in the Builder-Buyer agreement to
be monitored while releasing the installment of loan.
However, in cases of proiects sponsored by Governmenu
Statutory Authorities, the loans may be disbursed as per the
payment stages prescribed by such authorities, even where
payments sought from house buyers are not linked to the
gtages of construction.

10. TIME LIMIT FOR UTILISATION OF ADVANCE

i) EUIgIg.g.g_9!.!g!: The deal for purchase of land should be completed

and the sale deed produced within 6 months from the date of
disbursement of lirst installment failing which the advance should be
refunded in lump-sum.
However, in case of plots purchased trom Govt. Authorities on
leas€hold/freehold basis the timeline shall be as por stipulations
of the concerned local body and in cass of plots purchased trom
builder/ Agency it should not excosd 2 years. The General
Manager (Advances) will be the Sanctioning Authority to consider
extension of period trom 2 to 3 years on case to case basis. ln
case GM (Advances) has approved the original sanction, GM
(HRD) shall be the sanctioning authority lor extension of period
from2to3yaaB.

ii) Purchase of House: Mortgage to bank should be completed within

three months. Extension of time limit may be granted by the competent
authority.

11. CONSTRUCTION
D Adherence to Sanciion plans: lt will be condition for grant of loan
that construction is carried out on the basis of sanctioned plan by
the Sanctioning authority and in case of leasehold rights,
necessary permission is duly obtained from tho lessor (iI required
as per lease deed) to create equitable or registered mortgage over
the property. Prior concurrence of the concerned local body is
necessary for any deviation.
Pat€7ort6
,,..
(il(;Fdr
"\
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,/
'-\*/"9
 HOUSE BUILDING ADVANCE TO STAFF OF THE BANK

rD Tlma llmltr lh! rmployaa would hrvc to oontttuct thr houlc

within 2 y6ars from the dato of purchase of the plot. Extension of
period from 2 to 3 years may be considersd on case to case
basis, lf the work is delayed due to circumstances beyond the
employee's control, subject to stipulations of concerned local
body, if any in this regard. The ceneral Manager (Advances) will
bo the Sanctioning Authority to consider extension of period from
2 to 3 years on case to case basis. ln case GM (Advances) has
approvod the original sanction, GM (HRD) shall be the sanctioning
authority for extension oI period from 2 to 3 years.

ln case the employee fails to comply with the requirement to

complete the construction process, within th€ maximum
permissible period, as stated above, in that eventuality,
commercial rate of interest i.e. one year MCLR + Spread @ 3.55%
which is 12.00% as on date, shall be levied from such terminal
date specifisd in the sanction till compliance is evidonced.

Similar shall be the approach in case the employee disposes otf

the plou incomplete house midway, without hous6 construction
for which entire loan component shall attract commercial rate o,
interest one year MCLR + Spread @ 3.55% which k 12.00% as on
date, reckoned from the date of loan and the Loan has to be
closed from the sale consideration,

iii) lnsurance: On completion of construction/purchase, the house should

be insured by the offlcial at his cost against fire, flood, oarthquake,
riots and lightening for the full value of the house. The insurance policy
should be deposited with the bank and the premia receipts should be
produced for inspection. The insurance should be kept alive till
liquidation of advance.

iv) Maintenancei The house should be maintained in good condition and

kept free from all encumbrances. The officials should pay all taxes
regularly and furnish a certiflcate annually to that effect. Annual
lnspection may be carried out by the Competent Authority for checking
up the maintenance.

12. REPAYMENT OF ADVANCE

ln case of purchase of/ acquisition of built up house: Repayment
shall commence 3 months after the month in which the first
disbursement is mad6.

Pase 8of16
 HOUSE BUILDING ADVANCE TO STAFF OF THE BANK

ii) ln caag gl construction oI housg: The repayment to commgncs

withln 24 months aftEr the date of first disbursement of loan. The
postponement of commencement of repayment lrom 24 months to
36 months may be considered, in caso the construction is delayed
due to circumstances beyond the bank emPloyee's control' The
General Manager (Advances) will be th€ Sanctioning Authority to
consider extension of repayment trom 24 to 35 month on case to
case basis. ln case GM (Advances) has approved the original
sanction, GM (HRo) shall be the sanctioning authority for
extension of period trom 24 to 36 month' However, moratorium
period not to exce€d 6 months after the date of last disbursement
in any case.
iiD ln case of members of Co-operative Housing societiss/ Builders
flau apartment, thq moratorium period of upto 35 months after
first disbursement of loan or completion of society/ Builder's flat
whichgver is earlier is allowed in deserving cases. However,
moratorium Period not to exceed 6 months after the date of last
disbursement in anY case.
iv) ln case of construction of a new house by a Government agency'
recovery will commence from the pay of the month following the
completron of the house or the 36th month after the date of payment of
the flrst installment to the Government agency.
v) The interest will be charged from the date of disbursement of the loan
or the date of disbursement of flrst installment of the loan where such
loan is disbursed in installments. The amount of interest will be
calculated on the principal outstanding balance on daily basis'
vi) ln the process of recovery, the portion of the loan carrying higher rate
of interest will be treated as having been repaid first.
vii) All staff members who have availed of housing loan' are required to
ensure regular deposit of toan installments on the agreed terms and
conditions. lf any installment is already overdue, the concerned
employee is required to deposit the same immediately Branch
Managers are advised to verify each and every case of their branch
and send necessary notice to concerned employee for depositing the
overdue amount if any, immediately under advice to their controlling
authority. Non-payment of installments or non-deduction of installment
from the salary would be viewed seriously.
viii) ln case of default of housing loan installment, a penal rate of interest
not less than commercial rate of interest (one year MCLR + Spread @
3.55% which is 12.00% as on date), shall be on the sum of arrears'
ix) The Branch Manager to ensure that the salary disbursing
authority of the concerned employee is informed to start
PaBe 9 of 15
 HOUSE BUILDING ADVANCE TO STAFF OF THE BANK

deducting the housing loan installments trom hig/her salary as

and lyhen due tlll tinal adjustment of the loan.

13. SUBSTITUTION OF SECURITY

i. The employee is entitled for substitution of property once in life time.
ii. Before release of lien on the existing property amount equivalent to
total balance outstanding (i.e. Principal+ lnterest) in Housing Loan
Account to be kept in Sundry.
iii. The excess of sale price of existing propeo over and above the
purchase price of new property is to be deposited in the Hosing loan
account.
The installment be deducted regularly from salary till adjustment of loan
account.
The new property is to be purchased within 6 months from date of
Permission.
The employee would have to satisty the Competent Authority,
regarding clear, free and marketable title etc. of the new property to be
purchased and fulfill all the indispensible requirements as per bank
policy treating it as a fresh housing loan. Only the amount kept in
sundry creditors will be released with the permission of competent
sanctioning authority of housing loan.
vii. The employee will not sell/purchase property without the prior written
permission of the bank, and it falls under the power of sanctioning
authority of housing loan.
viii. Before allowing substitution of property sanctioning authority must
ensure that housing loan account is running regular and property
concerned is duly mortgaged as per bank policy and other
indispensable requirements have been complied with as per sanction
letter.

14. HOUSE BUILDING ADVANCE TO STAFF MEMBERS WHERE

HOUSE/ SITE/ PLOT IS IN THE NAME OF SPOUSE
i. Spouse is to be taken as co-borrower
ii. ln case ot working spouse, an undertaking from tho spouse must
be taken confirming that hE/she has not availed housing loan from
his/her organization for the said property.
lt. An affidavit on adequate stamp paper be taken from the spouse
confirming that there is no dispute, litigation claim, notice of demand
(Revenue or otherwise) against the land, house, site or the spouse
personally and that minor interest is not involved in any manner in
raising a loan against the security, mortgage of the said land , house or
property. The spouse shall further swear that till the liquidation and
Page 10 of 15
 HOUSE BUILDING ADVANCE TO STAFF OF TIIE BANK

written clearance of the loan by the bank, no charge alienation or

encumbrance shall be created on the house, site property.
The purpose of the advance should be for construction, renovation,
addition/payment to Govt. Semi-covt bodies, Housing Boards,
Development Authorities, Registered cooperative Societies for plovflat
allotted in the name of spouse and for repayment of loans already
taken by the spouse from other bank for purchase/ construction of the
house.

15. SANCTIONINGAUTHORITY
CATEGORY
Workmen staff, Officers in JMGS-I,
MMGS-Il & lll and SMGS-IV working
in Branch/Zonal offices
Offlcers in SMGS-V, TEGS-VI and
TEGS-VIl working in Branch/Zonal
Office/H.O.
All other members of staff working in
Head Office Departments
SANCTIONING AUTHORITY
Zonal Manager (SIVGS-V and above)
General Manager, H.O. Advances
Deptt
Dy. General Manager/ Asstt General
Manager, H.O. Advances Deptt

16. PROCESSING & OTHER CHARGES: Exempted. Out of pocket

charges to be borne by the employee.

17. LOAN FOR REPAIR AND RENOVATION

Facility for furnishing of house may be availed immediately after construction/
purchase of ready built housel/ flat. The components for furnishing loan will be
wooden work i.e. wardrobes/ wooden cabinets/ curtains. modular kitchen &
POP work.

Facility for repairs/ renovation of existing premises shall be available after Iive
years of initial construction/ original purchase in case of ready built house/ flat
and shall thereafter be further sanctioned after minimum two years period, on
adjustment of existing repair loan.
Further, the quantum of loan prescribed for repair/ renovation shall also be
allowed to be availed by the employees over and above the limits prescribed
for construction/purchase of House/Flat.

It is clarified that the loan for repair renovation be considered a fresh

loan and the rate of interest be charged accordingly.

Page u of 16
 HOUSE BUILDING ADVANCE TO STAFF OF THE BANK

'tL REGISTRATION CHARGES: Expenses which an employee has to incur on

stamp duty and registration charges (including GST) may be treated as part
of project cost for calculating maximum permissible bank finance.

19. PERMITTING EMPLOYEES TO ACQUIRE 2ND HOUSE WITHIN THE

OVERALL CEILINGS UNDER STAFF HOUSING LOAN

Employees shall be permitted to avail Staff Housing Loan for purchase of a

2nd House within the overall maximum revised limits stipulated for the Staff
Housing Loan without adjusting the existing loan account (the toan timits
availed for both the houses will not exceed the maximum revised limits
stipulated for the staff Housing Loan) as per the following terms:

The amount of loan under Staff Housing Loan for purchase of the 2nd house/
flat will be restricted to:

. 90% of the cost of the 2d House to be acquired/ amount outstanding,

as on the date of application in the loan account raised under public
scheme from our Bank or from any other financial instituuon to acquire
the 2nd House.
Or
. Entitlement as per the revised staff Housing Loan limits, reduced by
staff Housing Loan limit availed earlier, wtlichever is lower.

Any employee availing the Staff Housing Loan for purchase of a 2nd House
within hls/her overall maximum revised limit stipulated should not sell such
house/ property acquired by availing the concessional staff housing loan
within a period of 10 years from the date of availment of the loan for purchase
of 2d house (except in the cases of sale of the house on account of death of
the staff member/ sale of the house on account of separation of the employee
due to VRS/ resignation/termination or conversion of loan to public scheme as
per our existing policy).

ln the event of the said house/ property being sold within the period ot l0
years from the date of availment for any reason whatsoever (except in the
cases of sale of the house as stated above), this 2nd housing loan will need to
be liquidated immediately with the sale proceeds.

ln such a case, commercial terms as applicable to staff in case of public

housing loan scheme and rate of interest of MCLR + Spread @ 3.55% which
is 12.00% as on date, shall be applicable on the 2nd loan account for the entire

,'"43e Pas€ 12 of 15
 HOUSE BUILDING ADVANCE TO STAFF OF THE BANK

payment period from the date of availment to the date of liquidating the
account.

This availment of Staff Housing Loan for purchase of 2nd house (within the
overall maximum loan prescribed) will also be subject to the staff member
meeting all other eligibility criteria prescribed tike satary deductions etc. tt is
added by way of clarification that in cases where 70 years of age has been
considered for repayment, 30% of the Net take home income (after
superannuation) during the pendency of the loan liability must be
maintained, after deducting housing loan installment and accordingly amount
of loan over and above the eligibility so arrived at the time of retirement shall
be got adjusted from retirement dues ofthe employee.
Any staff member who has already availed a staff housing loan earlier and
now wants to construct a new floor, extension of the house etc. in the same
house, undertaking for fresh construction with a fresh estimate, even if it is in
the same house, will amount to a new project.

Under the revised scheme, housing loan can be sanctioned for construction of
a new floor, fresh construction for extension of the house etc. with duly
approved plan under new project treating the same at par with that of a 2d
house subject to the condition that both the units are independently saleable
as per legal opinion of the property. Further, fresh valuation of the property is
to be obtained to ensure that the value of the mortgage after construction
covers both the Bank's loans i.e. one taken earlier and the 2d sanctioned for
fresh project.

It is also to be ensured that the mortgage on the land/ property is with the
Bank at all times, pre and post construction and is extended to cover both the
loans.

The additional loan amount under statf housing loan shall not be granted
against personal borrowings taken by staff members from relatives etc and no
reimbursement either in cash/ in account shall be permissible to liquidate
personal borrowings of staff members.

20. TAKEOVER/ CONVERSION OF EXISITNG HOUSING LOANS OF

EMPLOYEES

Employees who have already availed housing loan from a Bank or any other
institutional sources such as housing finance institutions/ companies, housing
boards, commercial banks may also be allowed to convert their existing loan
account under the revised scheme for Housing Loan to staff members.
However for taking over the loan account from ks/ Fls or conversion
t't9 Page 13 of 16

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 IIOUSE BUILDING ADVANCE TO STAFF OF THE BANK

loan from public scheme to staff scheme, the sanctioning authority at various
levels should be satisfied with the genuineness of the reasons for not initially
availing housing loan from Bank.

21. GENERAL CONDITIONS

i. The title ofthe property must be clear, marketable and unencumbered.

ii. The property must be located in an area/ colony approved by the
local/ municipal authorities as residential area,
iii, Agreement for sale/ detalled cost estimate trom Architecu
Engineer/ empanellsd valuer for thc proposed dwelling unit to be
purchased / extended/ renovated/ constructed etc to be obtained.
iv. An employee shall execute alt documents as required by the bank and
the nominee(s) of the employee's provident Fund/NpS shall be
required to give a guarantee and an undertaking independenfly that if
need arises the provident Fund/ NPS fund would be available to the
Bank for the recovery of its dues under the loan granted to the
employee under housing loan scheme.
v. Equitable mortgage of land and building by deposit of tifle deeds of
property at notified centre.
vi. lf the house/flauproperty is in a cooperative society:
/ The share certificate issued by the cooperative society in the name of
the employee be deposited with the bank.
vii. The property so acquired with the help of loan should be used norma y
by the employee and his family and kith and kin.
viii. Any mis-utilisation of loan at any time or violation of any rule would
attract disciplinary proceedings under major penatty besides rendering
the employee liable to liquidate the advance immediately along with
interest at commercial rate (one year MCLR + Spread @ 3.55% which
is '12.00% as on date) from the date of first disbursement up to the date
of its adjustrnent.
ix. ln case, the employee is under suspension, the installment towards
housing loan will be deducted from the subsistence allowance paid to
the employee during the period of suspension.
x. The employee will not sell/assign or otheMise transacv deal in any
manner whatsoever with the house/property flat so acquired without
the prior permission of the bank in writang and subject to such
conditions as the Bank may stipulate in this regard and for release of
title deeds of the property mortgaged and charged to the Bank. ln case
of sale/assignment etc., etc., housing loan outstanding shall be
adjusted from the sale proceeds. lf the sale proceeds fall short of the
balance of the loan outstanding plus interest thereon, the deficit will

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7,t'9
 HOUSE BUILDING ADVA}ICE TO STAFF OF THE BA}IK

have to be paid by the employee immediately. Only then the bank will
release title of property.
xi. The loan ,Ivill be granted subject to the sole discretion of the
management. The management has full discretion in the matter.
xii. The employee will be required to apply on the form prescribed by the
Bank from time to time and produce all documents and evidence as
may be deemed necessary to the Bank.
riii. The documents executed by the loanee will be got renewed before
expiry as per the law of limitatjon.
xiv, The bank will have full discretion to make an assessment on any
reasonable basis of the cost of built house for the purpose of
determining the limit upto which the loan may be given and the bank,s
decision taken in this regard shall be final and binding on the borrower.
xv. ln case of purchase of house/flauplot from Government Authority,
Board, Cooperative Societies and where tite deeds are not ready for
execution and to be mortgaged with the Bank, the loan will be
disbursed after execution of tripartite agreement with the authority for
mortgage of property in Bank's favor (as per Bank's Counsel Advice
from case to case) and afrer making Bank's lien on property in their
record. The authority to undertake that if borrower resigns/ surrender/
expelled, the amount deposited with the Authority/ Board/ Society shall
be refunded after deducting their dues if any, to the Bank towards
adjustment of the loan.
xvi. For purchase of FIat trom aociety/ Builder:.
a) Society regbtration cortificate to be verified at th€ time of
appraising loan
b) The applicant should be a bonafide member of the society. Bye
laws of society to be obtainod.
c) A tripartite agreement io be entered into, which would be
enforceable till the deed is registered and ls submitted to Bank
by the sellsr.
d) As per the scheme of tie-up ryith builders, the branch need not
repeat the sxercise of legal opinion/ indsx inspection/
valuation/ approved map/ other govt. approvals/ NBC 2OOS/
construction & completion period. ln case of tie-up, master file
of all these documents to be maintained as per the approval
letter as per instruclions in Housing loan schome of the Bank
for ceneral public.
e) The credentiab of builder to be ascertained in all other cases
and all the required documenE to be obtained.
xvii, The employees who have already avalled the loan prior to their
promotion as per their entitlement of the previous cadres shall be
entitled to the ditference of the loan as per their revlsed entiflement
Pase 15 of 16
 HOUSE BUILDING ADVANCE TO STAFF OF THE BANK

pertaining to the cadre to which they are promoted minus the loan
already availed by them in the cadre prior to their promotion. For
example if an employee had earlier availed HBA while he/she was in
clerical cadre and is subsequenfly promoted to officers cadre he/she
will be entitled to the difference of loan as per entiflement in ofiicer
cadre minus the loan already availed while he/she was in clerical
cadre.
xviii. ln case there is any escalation in cost of project it would either be
met by the emplgyoe from his/her own sources or could be met by
reassessing the loan withln the laid down parameters for a higher
amount subject to maximum permissible amount.
xix. Housing loan cannot be sanctioned under Staff Scheme where
propedy is jointly owned by his/her family members (other than
spouse).
xx, ln case property is jointly owned by staff with his/her spouse, staff is
eligible for housing loan under staff scheme provided spouse is taken
as co-borrower. Also, income of ths spouse may also be
considerod for repayment in such cases. ln no case will
employ€€s be eligible for Housing loan amount equal to combined
limit. Other terms and conditions will be as per clause 14 above.
Ixi. lf the husband and wife both are working in our bank, house
building advance will be admissible to only one of them for one
property. As per policy employee is eligible for 2nd housing loan
also. lt is clarified that husband and wife (together) wi be etigibte
for housing loan for two properties at most.

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