Drop Down Overdraft (Scheme of Finance against property)

i.

Eligibility

–

Individuals & Business entities who is a bonafide member of the bank. Subject to the condition that Customer’s age plus overdraft tenor should not exceed 75 years subject to satisfaction of Bank.

 

ii.

Purpose

–

Any legitimate requirement of Working capital finance, except for speculative purposes.

 

iii.

Limit

–

 

 

 

 

 

Minimum- ` 5.00 Lacs

Maximum-` 25.00 Lacs,

 

Subject to three times of annual income.

iv.

Nature of Facility

–

 

Overdraft

 

v.

Rate of interest

–

 

13.50 % subject to levy of penal interest.

vi.

Margin

–

 

40% of value of mortgaged property.

vii.

Period  

a)

 

 

 

Maximum 10 years .

viii.

Methodology

a)

 

 

 

b)

Reduction in Operative limit proportionately (Minimum 10% by end of each year, synchronizing with review of the Account)

Interest to be recovered separately as & when applied in the account.

 

 

 

ix.

Insurance

–

 

The property will be comprehensively insured by the borrower with usual bank clause for the market value of the property (excluding value of land).

 

x.

Sureties

–

 

At least two satisfactory sureties of good means.

 

 

 

 

 

xi.

Security

–

Mortgage of non-encumbered freehold property owned by the borrower or third party and in case the same  is owned by third party, his/her personal guarantee to be stipulated, subject the condition that the relevant is a self-occupied property.

 

Over draft against tenanted property should not be considered except in case where property is given on lease to PSU,Reputed Government/semi Govt enterprises large corporates banks, financial institution and insurance co.

 

xii.

Other Conditions

 

 

 

 

a)

In case of partly rented properties, finance may be allowed against the realizable value of self-occupied portion only.

 

 

 

b)

If subsequent to availment of credit facility, the property is proposed to be let out, Bank’s permission would be required. The sanctioning authority would accord permission on merit of individual case and on such terms and conditions as deem fit.

 

 

 

c)

Other usual terms and conditions as per Bank’s rules as may be decided from time to time.

 

 

 

 d)

Balance sheet and ITR of the borrower to be submitted by the borrower on yearly basis

 

 

e)

 No relaxation in respect of margin and rate of interest will be allowed.

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