The purpose of this scheme is to provide an overdraft or extra term loan to existing home loan borrowers. This overdraft can be used for personal needs.
Scheme Code
- Overdraft – ODTOP
- Term Loan- TLTOP
Eligibility
The following home loan borrowers are eligible for the Top-up facility (Overdraft/Term Loan), subject to eligibility conditions, including repayment capacity and Loan-to-Value (LTV) ratio:
- All existing PNB home loan customers. No inspection irregularity which has been identified as serious in nature is outstanding and subject to fulfillment of all terms and conditions for facility under this scheme.
- All new home loan customers of our bank at the time of sanction
- All new home loan customers being transferred from other banks/HFIs with a satisfactory repayment record
- All new home loan customers being transferred from other banks/HFIs along with a top-up loan already availed from the previous bank. In this case Disbursement of Top-up (OD/TL) to be done even before creation of mortgage of house/property in favor of our Bank.
Conditions:
- Possession of the property must have been taken, and a mortgage on the property created, or the possession and mortgage in favor of the bank must be established before the disbursement of the top-up loan.
The PNB Top-up Loan Facility (Overdraft/Term Loan) for personal use will not be sanctioned to borrowers who have obtained a loan for:
(a) Purchasing a plot where construction is incomplete, and
(b) Flats/houses that are still under construction.
NRI/PIO/OCI home loan borrowers are not eligible for the Top-up (Overdraft/Term Loan) facility under this scheme.
Loan Amount
- Minimum Loan Amount: Rs. 2.00 lakh
- Maximum Loan Amount: Rs. 100.00 lakh
Overdraft Limit:
- Minimum: Rs. 2 lakh
- Maximum: Rs. 25.00 lakh
Term Loan:
- Minimum: Rs. 2 lakh
- Maximum: Rs. 100.00 lakh
Note:
- For home loans up to Rs. 75 lakh (including existing outstanding home loan and proposed OD/TL), the maximum loan amount will be 80% of the current realizable value of the house property.
- For home loans above Rs. 75 lakh (including existing outstanding home loan and proposed OD/TL), the maximum loan amount will be 75% of the current realizable value of the house property.
Home loan borrowers will be eligible for a maximum loan of Rs. 100.00 lakh, even if they have multiple home loans. Multiple loan accounts can be opened under this scheme for borrowers with multiple home loans under a single customer ID, capping the total limit at Rs. 100.00 lakh, either individually or jointly with others. However, the OD portion will not exceed Rs. 25.00 lakh in any case.
Repayment Period
- Overdraft: Based on monthly reducing Drawing Power (DP) and to be liquidated within the remaining period of the home loan or until the borrower reaches 70 years of age, whichever is later, with a maximum tenure of 30 years.
- Term Loan: Repayable until the remaining period of the home loan or until the borrower reaches 70 years of age, whichever is later, with a maximum tenure of 30 years.
Note:
Repayment of the loan, including interest, should not extend beyond the borrower’s 70th birthday. If the loan is granted to joint owners or co-borrowers, it must be ensured that at least one of the joint owners or co-borrowers can independently repay the loan and interest by the age of 70. The incumbent PLP CHCAC/ZOCAC and above may relax the repayment period to the remaining tenure of the home loan or until the borrower reaches 75 years of age, whichever is later.
Repaying Capacity
GAS/I and Maximum Permissible Deductions of GAS/I:
- Up to Rs. 5.00 lakh: 50%
- Above Rs. 5.00 lakh and up to Rs. 10.00 lakh: 60%
- Above Rs. 10.00 lakh: 70%
Additionally, AGM-PLP/CHCAC and above may allow a higher percentage of GAS/I deductions, up to a maximum of 10% over the prescribed ceiling for each bracket, based on the individual merits of each case and after evaluating the expenditure patterns of the prospective borrower(s). Therefore, deductions of GAS/I may be permitted at rates of 60%, 70%, and 80% for the respective brackets.
Note: When assessing GAS/I, no new borrower(s), co-borrower(s), or joint borrower(s) should be added. The latest income of all borrower(s), co-borrower(s), and joint borrower(s) considered at the time of home loan sanction must be used to determine repayment capacity and loan assessment. However, the income of a spouse not included during the home loan sanction may be considered for assessing repayment capacity, provided they are made a co-borrower.
Enhancement and Restoration of Top-Up OD Limit
Enhancements to the Overdraft (OD) limit (with a reducing Drawing Power) under Scheme Code ODTOP, within the overall ceiling of Rs. 25.00 lakh, may be permitted only if the home loan is still active and not adjusted, subject to the fulfillment of other terms and conditions of the scheme.
Upon the borrower’s request, the bank may consider restoring the original limit or enhancing it after 36 months, provided the account has been maintained satisfactorily. This includes a good repayment track record during the loan tenure, adequate repayment capacity, and sufficient margin availability.
If restoration or enhancement is granted, it will be contingent upon the current realizable value of the property (calculated according to the bank’s existing guidelines), repayment capacity, eligibility, age, and compliance with other terms and conditions of the new scheme.
However, enhancements to the existing Top-up Overdraft limit (without a reducing Drawing Power) are not permitted. Any request for enhancement will be treated as a new sanction in accordance with the new scheme guidelines. The previous top-up account must be settled before any transactions can occur in the new Top-up (OD) account.
Processing Fees & Documentation Charges
Applicable for both Overdraft and Term Loan:
- Processing/Upfront Fees:
- 0.35% of the loan amount
- Minimum: Rs. 2,500
- Maximum: Rs. 15,000
- Documentation Charges: Rs. 450 (excluding taxes)
Note: Processing and documentation fees will be applied only once at the time of loan sanction, restoration, or enhancement.
Some Important Points
- Security: Extension of charge or creation of charge on the existing mortgaged immovable property or the property to be mortgaged.
- For collateral linking, Enter the home loan against which the Top-up (OD/TL) is sanctioned in Free Text 9 of the MIS details for the Top-up (OD/TL) account while opening the account under the ODTOP/TLTOP scheme.
- If the EMI (or monthly reducing Drawing Power in the case of Overdraft) is not paid within 7 days after the end of the month, the borrower will be subject to a penal interest of 2% in addition to the applicable rate on the defaulted amount for the duration of the default.
- The top-up (overdraft) facility should be reviewed once in three years.
- Existing top-up Overdraft facility (sanctioned without reducing DP) can be continued/ renewed, even after the Home Loan is paid fully provided the sanctioning authority is satisfied about the conduct of account and the value of security.
- Employees of our bank may also be eligible for a Top-up Loan (Overdraft/Term Loan) for personal needs related to their home loan borrowers, subject to the following conditions: Maximum deductions for the repayment of all borrowings from the bank (including notional interest on staff OD, if applicable) and other sources, including deductions for the proposed loan, should be limited to 60% of their gross emoluments.