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ELEMENTS TO DETERMINE COST OF THE HOUSE
a. Readymade Properties
Agreement value for buying the property.
Value of amenities provided along with the flat and payment made separately under an amenities agreement. In most cases, the amenities agreement is an attempt to segregate the cost of the amenities to avoid paying the high stamp duty on real estate in India. Most banks restrict the value of the amenities to around 20 per cent of the total agreement value of the flat. However, if the amenities agreement is also stamped and registered most banks will consider 100 per cent of such costs.
Stamp duty and registration charges to be paid on the agreement. Initial capital expenses, such as civil work, are to be met with.
Some banks will also include transfer charges payable to a cooperative society, deposits required by electricity companies, and separate payments for club houses.
Banks would also consider any cost incurred towards purchase of a parking space.
Cost of furnishing: In case of specific tie - up with a builder, a bank may include the cost
of ready furnishings provided along with the flat. Typically bank will not provide loan
for some of the elements of cost such as stamp duty or registration cost. But some banks consider cost such as stamp duty or registration cost include in cost of property.
b. Self - Constructed Properties
Cost of the land, taken as the cost to customer or current market value, whichever is lower. Some bank will not take the cost of the land into account if customers have brought it more than a year ago. Cost of construction as estimated by customer's architect and vetted by the bank, fees paid for obtaining legal and statutory approvals, stamp duty and registration charges payable on agreement.
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