Tamil Nadu increases housing loan limits for urban cooperative banks

Tamil Nadu has updated the loan limits and guidelines for housing and mortgage loans given by urban cooperative banks and urban cooperative credit societies. Cooperation Minister V. Gandhiraj announced the changes.

Loan Limits

For urban cooperative credit societies, the top individual loan limit is now sixty lakh rupees for societies with deposits under one hundred crore rupees. For societies with deposits above one hundred crore rupees, the limit is one crore rupees. For urban cooperative banks, the maximum individual housing loan limit is sixty lakh rupees for banks with deposits below one hundred crore rupees, and one crore forty lakh rupees for banks with deposits above one hundred crore rupees. This follows Reserve Bank of India guidelines.

Repayment And Rules

The maximum time allowed to repay housing and mortgage loans for both types of institutions is now extended to twenty years. This change helps lower the monthly payment burden for borrowers. The Cooperation Department noted that some banks were giving loans below the limits set by the RBI, so it told them to give loans up to the proper limits. Banks and societies must update their loan rules and by-laws and get approval from the Regional Deputy Registrar.

Context

Cooperative banks and credit societies play an important role in giving loans to middle-class and lower-income families who may find it hard to get money from big commercial banks. Raising these loan limits helps more people buy homes as property prices rise.