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Notes On NHFS

Notes on
New Housing Finance Scheme

[NHFS] With EMI Chart

(Changes up to HO Cir. 25/2015 Dated 18/04/2015 included )

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Notes On NHFS

The Company has operated two separate schemes for housing purpose. One is
for house modernization[HMS] & the other for new construction[NHFS]. As
per Cir. 101/2000 dated 16/06/2000 these two schemes were merged together in
to a single scheme, namely NHFS. Initially the scheme was operated from our
loan units only. As per Cir.13/2012 dated 29/03/2012 the scheme extends to all
of our units.
This is a purpose oriented Loan Scheme. It should be disbursed to those
who are complying with the rules and regulations of NHFS as per Company
circulars.
Purpose of Loan & maximum amount of advance:
1. To construct a new residential house- Rs. 50 Lakh
2. To purchase a plot with a residential house or Flat

- Rs. 50 Lakh

3. To renovate an existing residential house - Rs. 20 Lakh

4. To perform additional construction works on an existing house(up to
1200 square feet) - Rs. 20 Lakh
5.

To purchase a Dwelling site

(provided to start construction work within 12 months)-

Rs.10 Lakh
(HO Circular 16/2015(BD) Dated 23/03/2015)

Ownership & other details of the pledged property:

1. The applicant should be the owner of the property/plot
2. He/She may be a co-possessor with his/her husband/wife only
3. No property may be accepted having joint ownership other than
husband & wife.
4. As usual never accept those deeds having rights to minors.
5. If a second person is having life interest over the property, it may be
accepted, including the life interest holder in the agreement.
6. The property should have minimum extent of 3 cents in municipal
area & 5 cents in Panchayaths.
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Notes On NHFS

7. Transactions between family members are strictly cautioned in

purchase loan.
Eligibility of the Applicant:
1. Applicant should be a citizen of Kerala & having the ownership of
site.
2. He should have a comfortable monthly income for repayment.
Age limit of the Applicant/Co-obligants: (HO Cir. 1/2015(BD) Dated 8/1/15)
The applicant shall not attain the age of 70 since the repayment should
complete within the age of 70.
This condition is mandatory for all the co-obligants also.
If married OR the offered property is a joint one, husband/wife should
join as co-obligants.
Repayment Period of Loan: (HO Cir. 16/2015(BD) Dated 23/03/2015)
1. For construction of New residential house

- 20 years

2. For outright purchase of land with residential house - 20 years

3. For renovation/additional Construction

- 10 years

4. For the purchase of a Dwelling site - 7 years

5. Minimum period of repayment -12 months
(Subject to completion of repayment period within 70 years of age)

Prevailing rate of interests (Cir. 19/2015 wef 27/03/2015) Public:

Up to Rs.5,00,000 :10.00 % Yearly diminishing
Above Rs. 5,00,000 :10.50 % Yearly diminishing

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Notes On NHFS

NHFS EMI for Rs. 1,00,000 ( HO Cir. 19/2015 wef 27/03/2015)

No. Of
Month

@10.00%

@10.50%

@7.50%

Principal

Interest

Total

Principal

Interest

Total

Principal

Interest

Total

12

8333

833

9167

8333

875

9208

8333

625

8958

24

4167

635

4802

4167

667

4833

4167

474

4641

36

2778

573

3351

2778

602

3380

2778

426

3204

48

2083

546

2629

2083

574

2657

2083

405

2488

60

1667

532

2198

1667

559

2226

1667

393

2060

72

1389

525

1913

1389

552

1941

1389

386

1775

84

1190

521

1712

1190

550

1740

1190

383

1573

96

1042

520

1562

1042

549

1591

1042

381

1423

108

926

521

1447

926

550

1476

926

380

1306

120

833

523

1356

833

552

1385

833

381

1214

132

758

525

1283

758

555

1313

758

382

1139

144

694

529

1223

694

559

1253

694

383

1077

156

641

532

1173

641

563

1204

641

385

1026

168

595

536

1131

595

567

1162

595

386

982

180

556

540

1096

556

571

1127

556

389

944

192

521

544

1065

521

576

1097

521

391

912

204

490

549

1039

490

581

1071

490

393

883

216

463

553

1016

463

586

1049

463

396

859

228

439

558

996

439

590

1029

439

398

837

240

417

562

979

417

595

1012

417

401

817

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Notes On NHFS

Until the fixation of EMI, simple interest at prevailing rate should be remitted
by the loanee(Now @14%) at every month.
Rate of Penal int. on EMI 18%
Delegation of Powers for Loan Sanction (As Per Cir.24/2014 Dated 21/05/14)

1. Up to 10,00,000 Unit Head

2. Up to 15,00,000- Assistant General Manager(RO)
3. Up to 25,00,000- DGM (B & OP) & GM(B)
4. Above 25,00,000- Director Board.
Charges to be collected:
1.

NHFS Application form: Rs. 10

2. Processing charge and Administrative charge for NHFS:

(Cir.13/2014 Dated 07/03/2014

WEF 15/03/2014)

Up to 10 Lakh:
0.5% loan amount (Minimum Rs.1250 & Maximum Rs.5000)
Above 10 Lakh & up to 25 Lakh:
0.5% loan amount (Minimum Rs.5000 & Maximum Rs.12500)
Above 25 Lakh
0.5% loan amount (Minimum Rs.12500 & Maximum Rs.15000)
3.

NHFS Retention Fund (Refundable): As per Cir. 24/2014 Dated

21/05/2014, it is stopped.

(No need to collect valuation fee, since the legal scrutiny fee & valuation
fee are to be paid from NHFS processing charge A/c)
If the applicant does not avail the loan subsequent to valuation & legal
scrutiny, then balance amount after maintaining the fee for valuation &
legal scrutiny may be refunded from Processing Charge & administration
cost.
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Notes On NHFS

Number of Installments for Loan Disbursement

The Loan should be disbursed in equal installments. The number of installments
of Loan payment may depends on the nature of Loan. ie, construction,
additional construction, outright purchase etc.
For Construction /Additional Construction: Three installments
For renovation/extension: Two installments
Outright purchase of land OR land with Building: Single Payment
Documents to be submitted
We have to collect all the property documents which are necessary for the
creation of mortgage as usual.(This includes Prop 1 & 2,Deeds,prior deeds,
Location, Possession ,sketch , EC ,LTR, BTR(if any),EC etc). In addition to,
collect the following documents, depending on the nature of Loan:
For the construction of new residential house:
1. An estimate of construction illustrating the details of works to be
done.(This may get attested by an engineer in govt. service)
2.

An approved Building permit with plan from the concerned

Municipal/local bodies.(In some of the panchayaths in Kerala, there is an
exemption for approved building permits for house construction. May ask
for proper documents towards the claim). The building permit is usually
issued for three years and ensures that the period has not been lapsed.

For outright purchase of land OR land with residential house

1.

The sale agreement in original between the seller & loanee. (Now the
govt. of Kerala ordered to register sale agreements with a fee of 2% of
sale value. Make sure its legal accuracy). The sale deed may have a
specified period and ensure that it has not been lapsed.

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Notes On NHFS
2.

All the property documents (prop 1& 2, LTR, BTR, Possession, location
etc should be in the name of seller). Please note that the wordings of
Prop 2( the affidavit) from the seller. Only photocopies of deeds are
insisted and originals may be returned after attestation.

3. While advancing for the purchase of a dwelling site , loanee should agree
through an undertaking that the construction of the proposed residential
house should starts within 12 months.
Security of Loan:
The security for the advance will be the offered property /plot purchased and
construction thereon. The Estimated Market value should not be less than 1.3
times of loan amount.
For renovation/additional Construction:
1. An estimate of construction illustrating the details of additional works to
be done.(This should get attested by an engineer in govt. service).
2.

An approved plan, if any from concerned local bodies for additional

construction.(The area should not exceeds 1200 sq. feet.). If it exceeds
1200 sq. feet, it may be considered as a new construction.

Documents to prove Income:

Applicant should produce proper documents to prove his/her monthly
income. It should be genuine & get confirmed.
As per Cir. 25/2015 dated 18/04/2015, if the applicant is from
agricultural income group/Self employed person/small traders/ Professionals and Businessmen, the branch manager can assess his/her

income,

if it is less than Rs.2,50,000.Loanee may ask to produce Income

certifi-

cate from Village Officer/Tahasildar.

A no-resident Indian may submit documents including passport
from his sponsor/employer regarding income-contract and employment
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Notes On NHFS

up to a loan of Rs. 2,00,000.[All these documents should get attested by

Indian embassy, if the applied amount exceeds Rs.200000].
Salaried people may submit their employment certificates. The
repayment capacity of the applicant should be properly confirm. It shall
be assessed and reported by the officer who conducts the first property
valuation.
The income of husband & wife may consider jointly.
The

monthly

income

of

the

dependents

OR

unmarried

children(major) of loanee may consider as income under request,

provided that they should join as co obligants & subject to consider
maximum of 20% of total income required for the loan.

Processing of Loan Application

1. Arriving of Eligible Loan Amount:
Consider the following options; the least should be the eligible amount:
a. 75% of the submitted estimate amount OR 75% of sale agreement
amount(purchase loan).
b. 75% of the value of the property assessed through valuation.
c. Loan amount applied.
d. Rs. 50 lakh, Rs. 20 Lakh, Rs. 10 Lakh as the case may be
e. Proportionate Loan amount , fixing 45% of gross monthly income
of the loanee as EMI
Illustration: Monthly Income 25000.00
45% of 25000 = 11250
@ 10.00 % :11250 x 1000/9.79 =11,49,130.00
@ 10.50 % :11250 x 1000/10.12 = 11,11,660.00
(Int. product for 240 months considered)
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Notes On NHFS

2. Assuring the initial investments:

Applicant should invest at least 25% of submitted estimate amount
initially for new construction. This may properly endorse in the first
property valuation report.
In the case of purchase loan the applicant should have paid the
difference amount of 25% to the seller early, and it should be clearly stated
in sale agreement.
Regarding renovation/extension works, initial investment of 25% is
not compulsory.
3. Collection of Fee:
The prescribed Processing fee should be collected on receiving the
filled application form.
Administration cost may be collect after sanctioning the loan.
Retention fund No need to collect.
4. Disbursing of Loan Installments:
After sanctioning by concerned authority, a valid equitable mortgage should
be created with all usual formalities. The loanee may ask to produce
Encumbrance certificate for the period including date of mortgage. No need
to insist EC in between installments.

1. Construction/Addl. Construction .(Refer Cir. 101/2000 for details)

The initial investment by the loanee should be clearly confirmed.
Even though initial investment is done, the first installment should not be
sanctioned, if the basement is not completed.
Divide the loan amount in to three/two installments as the case may
be. In the NHFS loan issue form, enter the sanctioned amount as loan
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Notes On NHFS

amount and got authorized by assistant manager concerned. Then disburse

the first installment amount only. After spending the disbursed amount, the
loanee may ask to approach our office & submits an application stating that
the amount is invested at the site and second installment may be allowed.
The branch official should confirm the genuineness of the claim by
visiting the site. A site inspection report should be prepared illustrating the
progress of construction works & amount invested at the site. The invested
amount should get tallied with the initial investment & disbursed amount.
If the site is not within the jurisdiction of the concerned manager, a site
inspection request may forwarded to the nearest branch with copies of
location, possession, sketch certificates, plan, estimate and details of loan.
Same procedures may adopt on the payments of subsequent
installments.
The loanee must claim 2nd / 3rd installments within 4 month of availing
first/second installments.
Extension of period beyond 4 months under the discretion of unit
heads.

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Notes On NHFS

Disbursements Status of works to be Utilization/completion

of Installments confirmed
certificate
Instalment-1
Basement
Valuation report-BM
Instalment-2
After Inst.1 ,Construction up Utilization/Site Inspectionto roof level(Single storied BM
bldg)
Instalment-3

and ground floor

concrete(Two storied Bldg)

After Inst .2 ,Completion of Utilization/Site InspectionBM
roof concrete (Single storied
bldg) and First floor roof Completion certificate from
Approved
concrete(Two storied Bldg)
architect/licensed building
supervisor/any

Civil

Engineer in service
Fixation of EMI:
After disbursing the prescribed installments the fixation of EMI
should be performed. After that passbook may prepare and issued to the
loanee.
If the loanee does not come to avail 2nd installments within 4 months
& not request to extent the period, a registered notice should be served. If
no reply, recovery steps will be initiated to recover loan plus interest.
If the loanee is requesting to fix EMI, the branch manager can decide
it after making a site inspection to ensure the utilization of disbursed
amount.

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Notes On NHFS

Outright purchase of Site/building:

(Please refer Cir. 29/95 Dated 08/11/1995 for details and annexure). The initial

payments should get confirmed through the sale agreement. The registration
deed should get prepared with the endorsement of our loan payment details
including loan amount , cheque number , date, name of bank etc.(These
wordings should informed to the loanee prior to the preparation of deed.
(For details please refer Cir. 101/2000)
One of our officers should attend the registrar office and informed as the
authorized official to collect the registered deed from SRO. The receipt at
the time of registration should be obtained by the company. It should
ensure that the registration deed is prepared with the required stamp duty
prescribed on the amount shown in the sale agreement. It is also get
confirmed that the loanee have remitted the required fee on the sale
agreement amount to the government.
Please note that all charges that are to be collected should be remitted by
loanee in cash, since it is not possible to deduct the amount from cheque to
the seller.
It is the duty of the loanee to collect all the prior deeds in original from the
seller & hand over to our official on the date of registration at SRO.
After collecting the Original new deed from the SRO, the Manager
should inform the loanee to reach the office for mortgage creation. After that
he may ask to produce all the revenue records of the property from village
and SRO. All the deeds including the new one should kept safely at the
branch. EMI should be fixed on the date of payment itself.
Purchasing of Flat: Please follow HO circular No 158/2005 dated
114/11/2005 and HO Letter No 12401 Dated 07/04/2012 while accepting
applications for purchasing of flats.
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Notes On NHFS

Note the following while accepting flat:

1.

Cost per squre feet should not exceed Rs.3500(Cir. 1/2015 Dt. 8/1/2015)

2. Ask to produce the Bye-law of the society concerned

3. Area of flat is Built up carpet area(the inside area). Never consider
common areas.

NHFS Purchase Loan-

1.
. ( ,
$ , % , , ) ,
,
).
2. ,

%
.
3. $
.

4. Prop1 ,prop 2
@ 4.

24

4 4. prop 2 4 content

5.
6.

.

24 4 @,.

7.

$
% K
. )
,
,

4

.
8. 4
payee @

4 4 4

24 ,
. a/c
$ .

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Notes On NHFS

9. $ 4
,

L 4 4 , 2 recital O
@
4 ,
.
10. @ 4 4 4

$ 2, , ,

@,.
11.

, 4 L $ @ 4 4
(4

12. 4 Q @4
K 4 % 4. %4
V%
, %4
, .
13. % 2

4 Equitable Mortage @
.
V $ $ , (
)
.($ @,

Prop 1, 2 V% 2, Equitable Mortage
@, 4.
14.
, ,
2, ) Q

( O
24 @,.

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Notes On NHFS

Sample of Recital to be incorporated in Purchase Loan Sale Deed

...............................................ta {]Imcw Xmsg ]n-I-bnse hl-Ifn

F\n-p

ka-kvXm-h-Im-i-fpw

ay-am

aptJ\ xx ew cq] Xocphne \nbnv \nv Xocp

Xcn-Ibpw,

Bb-Xn

xx

ew

cq]

\n

sdmw ]W-am-bpw, _mn Xocphne xx ew cq] tIcf

tv ^n\mjy Fss{]-kkns xx
\n-fpsS t]cn

`h\ hmbv]-bmbn xx

_mv xx

imJbnse xx Xob-Xn-bnse xx \ sNv aptJ\ F\nv

\n-fn
F\n-p

Inn t_m[y-s-Sp-I-bpw, Xmsg ]n-I-bn

ka-kvXm-h-Im-i-fpw ...........................

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Notes On NHFS
Annexure III(NHFS-IV)

LETTER OF UNDERTAKING
From
Sri/Smt.______________________
_____________________________
_____________________________
I have applied for a housing loan from your branch. You have sanctioned
a sum of Rs.__________________ for the purchase of ________________cents
of property comprised in Rsvy No______ situated in _____________
village_______________________taluk_________________

district

from

Sri./Smt.______________________. I hereby undertake to deposit the original

title deeds of the said property after registration, in favour of KSFE Ltd. for
creating equitable mortgage.

Thanking you
Yours faithfully
Signature
Name & Address

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Notes On NHFS
NHFS-V

Letter of Authorization to collect Title deeds from Registrars Office.

From
_____________________
_____________________
_____________________
To
The Branch Manager
KSFE Ltd.
Sir,
I,

Sri/Smt________________________________________________

have applied for plot/house purchase loan from your institution. You have
sanctioned

me

sum

of

Rs.___________________

(Rupees________________________only). After registration of the sale deed, I

hereby authorize you to collect the original documents from the sub registrars
office on my behalf.

Thanking you,
Yours faithfully

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Notes On NHFS

NHFS-VI

Certificate
I,___________________________________________________________
Branch Manager/Assistant Manager of _________________________ branch
of the Kerala State Financial Enterprises Limited, was personally present at the
time of submission of documents for registration of the property mentioned in
the loan agreement dated________________ and certify that a recital of the
fact that ___________________________ branch has advanced a loan amount
of Rs._______________ (Rupees ________________________________only)
vide

cheque

no___________

___________________Bank

dated_____________________drawn

______________________

branch

for

on
the

purchase of site/ site with building has been incorporated in the sale deed.
Name of the Officer

Signature with date

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Notes On NHFS

DECLARATION
I hereby agree that the following documents will be produced at the earliest
after the registration of the document in my name.

1. Land Tax receipt

2. Possession certificate
3. Sketch & Location Certificate
4. Building Tax receipt
5. Building Ownership certificate
6. Encumbrance Certificate

Signature with name & address of loanee

Place:
Date:

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Notes On NHFS

Letter of Authorization from loanee to pay cheque to seller

From
_____________________
_____________________
_____________________
To
The Branch Manager
KSFE Ltd.
_________________
Sir,
I,

Sri/Smt________________________________________________

have applied for plot/house purchase loan from your institution. You have
sanctioned

me

sum

of

Rs.___________________

(Rupees________________________only). I request that Kindly pay the

cheque to Sri./Smt. ________________________________________, the
owner of the property towards the settlement of amount as per sale agreement in
between us.

Thanking you,
Yours faithfully,

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Notes On NHFS

Receipt

Received

with

thanks

from

______________________a

the

Branch

sum

of

(Rupees__________________ vide cheque

Manager

KSFE

Ltd.

Rs________________

No__________________ Dated

___________________of ____________________ Bank _______________

branch towards
comprised

in

the
Re

sale prize of
Survy

_______________ desom

the land/land with residential house

No__________of_______________Amsom

________________village ____________Taluk

________________ District with an extent of______cents, sold to Sri./Smt.

_______________________________________________. This payment of
loan amount is under the New housing purchase finance scheme sanctioned to
Sri. Smt____________________________________________ from KSFE Ltd.
_____________branch.

Signature with date

Name & Address of the seller

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Notes On NHFS

Letter Evidencing The Deposit of Title Deeds

To
The Branch Manager
KSFE Ltd.
________________
Sir,
I write to put on record that as already agreed upon, I have on_______________
deposited with at ____________________________ , the following documents
of title to immovable property with an intention to secure the repayment to the
Company of money that are now due to shall from time to time or at any time
due from me either solely or jointly with any other person to the company on
account of Housing Loan or any manner what so ever and include interest ,
commission and other charges of the company and any liability incurred in
connection thereto.
Sl. No

Details of

Description

Estimate value

Title deeds

of property

by Depositors

Yours faithfully

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Notes On NHFS

The Kerala State Financial Enterprises Ltd.

FROM

TO

BRANCH MANAGER

BRANCH MANGER

Our Ref: NHFS-

Your Ref:

Date:

Request for Site Inspection

Sub: Disbursement of Housing Loan Installments-Inspection of Construction siterequest-reg.
Ref: NHFS-________of Sri./Smt.__________________________________
[Submitted Estimate amount is Rs_________________].
We have sanctioned an amount
Sri.__________________________________as
construction/renovation of residential house.

of Rs.__________________to
NHFS
advance
for
the

Out of which Rs._______________ has already been disbursed as first/Second

installment/s.
Now the loanee approach us for Second/final installment.
Therefore we request that kindly visit the construction site & send us the status
of construction works & amount invested so far.
We are enclosing the copies of Estimate ,Possession, Location & sketch
certificates.

BRANCH MANAGER
Copy to : Loanee, Sri./Smt.

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Notes On NHFS

Kerala State Financial Enterprises Ltd.

(a government of Kerala Undertaking)

Branch Office :

Ref No:NHFS-

Date:

NHFS Site Inspection Report

Account
No

Name of Loanee

Date of payment of
last installment

Amount sanctioned
Installments/amount
disbursed so far

Date of request for

next installment

Estimate Amount

Nature of Loan

Name of the Inspecting Officer

:_________________________________________

Date of Site Inspection

:________________________________________

Current Status of Construction

:_________________________________________

Materials, if any stored

:_________________________________________

Approximate investment made

:_________________________________________

Proposed works to be done

:_________________________________________

Recommendation

:_________________________________________

_______________________________________________

Site Inspecting Officer

Branch Manager

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Notes On NHFS
NHFS XI

THE KERALA STATE FINANCIAL ENTERPRISES LTD.

(A Government of Kerala undertaking)
HOUSING FINANCE
Date :

Branch :
RECEIPT

This receipt executed by sri/smt ........................................

.........................

aged........................S/oD/oW/o........................................... of
.......................................................
house
....................................................
village.................................................taluk...............................district
............................ state now residing at ..................................... house
.................................... village ...................................... taluk
.......................................... district
........................... state employed as
..............................................[herein after called the payee]for Rs.......................
[Rupees .............................. only] in favour of the kerala state financial
enterprises limited, a company incorporated under the companies act, 1956 and
having its registered office at Thrissur [herein after called the company]
whereas the payee is a loanee under the companys New Housing finance
scheme agreement No............... dated ................................. and the payee has
received from the company in cash an amount of Rs..........
[Rupees........................................................only]
towards first/second/final installment. This receipt for Rs............................
[Rupees................................................ only] ( total amount) is hereby given by
the payee in token of having received the full amount due to him/her under the
said Housing Finance agreement subject to his/her obligations to pay future
installments as stipulated on the Housing Finance Agreement.
Signed by Sri/Smt........................................................ stamp
in the presence of witnesses

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Notes On NHFS

COMPLETION CERTIFICATE
This is to certify that I have inspected the construction/modernization/extension
work of the residential building in SyNo__________Rsvy No________
of________________________
______________________

village
District

______________Taluk

owned

Sri/Smt._________________________

and

possessed

by

___________________

______________________________________________________________as
specified in the plan and estimate approved by the company and that the work
has been completed.
Date :

Name :
Designation :
Signature of the Engineer :

(office seal)

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Notes On NHFS

Premature Closing/Bulk remittance

1. Premature closing without availing entire installments:
Simple interest (now @14%) has to be collected from the date of payment of
each installments subject to a minimum period of One year. Add penal interest
@ 18% as the case may be. Deduct the simple interest already remitted, if any.
Sum of the arrived amount and the total disbursed amount less Retention fund
has to get collected from loanee.
(Same illustration can make use of for the p/closure after fixing EMI, but before
first installment become due).
2. P/Closure after fixing EMI, but before completing One year:
Interest at the prescribed rate for EMI should be collected for a minimum period
of One year, in addition to simple interest collected, if any. If the a/c is under
default on the date of P/c, penal interest should also be collected & adjustment
of Retention fund as usual.
3. P/closure after One year of Fixing EMI:
Here the loan account should be rework on yearly diminishing basis with the
prescribed rate for EMI until the date of closing. The total repayment per year
should get deducted & balance carries forward to next years opening. The
process is continued till date and the balance due is the amount of P/closing.

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Notes On NHFS

Example:
Loan amount:500000 Rate :10.25% Date of EMI fixation :10/02/2010
Period:180 Month EMI:5556(2778+2778) Date of P/closing :28/04/2014
period

Amount
Outstanding

Interest

Total

EMI amt. Balance

remitted

3(2x10.25%) 4(2+3)

6(4-5)

10/2/10 to 10/2/11

500,000

51,250

551,250

66,672

484,578

10/2/11 to 10/2/12

484,578

49,669

534,247

66,672

467,575

10/2/12 to 10/2/13

467,575

47,926

515,502

66,672

448,830

10/2/13 to 10/2/14

448,830

46,005

494,835

66,672

428,163

10/02/14 to 10/04/14

428,163

7,314

435,477

11,112

424,365

10/04/14 to 28/04/14

424,365

2,146

426,510

426,510

Interest
@10.25%

Amount of
Loan O/s at
Principal
year end
repayment

It may also be illustrated as follows:

Year

Amount
Amount
Outstanding
at remitted
beginning of year
EMI

Year 1

500,000

66,672

51,250

33,336

484,578

Year 2

484,578

66,672

49,669

33,336

467,575

Year 3

467,575

66,672

47,926

33,336

448,830

Year 4

448,830

66,672

46,005

33,336

428,163

2 month

428,163

11,112

7,314

5,556

424,365

18 days

424,365

2,146

426,510

2,77,800

2,04,310

1,38,900

TOTAL

via

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Notes On NHFS

Amount of Premature closing : Rs.426510

Advance :5,00,000-1,38,900 = 3,61,100
Interest :2,04,310-1,38,900 = 65,410
Total :3,61,100 +65,410 = 4,26,510
4. Reworking of EMI on Bulk remittance (10% or above of the advance):
Here the outstanding NHFS advance show a debit balance of
Rs.3,61,100 & interest on NHFS shows a credit balance of Rs. 1,38,900.
Suppose loanee wish to remit Rs.75000 as lumpsum to this account.
We have to make advance O/s to Rs.426510 and Interest credited
amount to Rs.204310.
For this, prepare a General transfer challan debiting NHFS advance and
crediting Interest on NHFS, for an amount of Rs. 65410(the difference).
Then adjust the amount of Rs.75000 by crediting it towards principal
outstanding of Rs.426510
The new loan outstanding will be 426510-75000 = 3,51,510
This amount has to be repaid in the remaining 130 installments
@10.25% int. with due date on every 28th day.
New EMI: Rs.4601.00 (2704 +1897)
(All the above illustrations are based on manual procedure. This can be used
for arriving the values manually).

Details Regarding Company Employees

Rate of interest with a concession of 2.5 %
Up to Rs.5,00,000 : 7.50 % Yearly diminishing (If EHL is not availed)
(If EHL is availed, concession rate of 7.50% is given for Loan up to Rs.1,50,000 only)

Above Rs. 5,00,000 :10.50 % Yearly diminishing.

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Notes On NHFS

Exemption in remitting fee/charges:

None of the fee need be collected from company employees, such
as Registration fee, Processing fee, Administration cost &
Retention fund. Keep in mind that the payment of legal scrutiny fee
to panel advocate & valuation fee to approved valuer may be
debited to NHFS processing charge a/c.
Exemption in initial investment:
The condition of initial investment before availing the loan will not
insisted for company employees.
Authorities concerned
Our Business department is the authority of processing NHFS
applications. Contact P&HR department for matters related with
Employees housing loan [EHL].
Sending of Documents to HO
While processing NHFS application, sent all the revenue records in
original, and attested copies of all original title deeds to
HO[Business].
After making payment of all installments & fixing EMI, the Salary
recovery request should be forwarded to HO[P& HR] on the same
day, including details of loan.
Salary deduction facility:
The employee should remit the EMI through deduction from his/her
monthly salary.
Access to the property:
In the case of company employees, head office is insisting for fourwheeler motorable access to the site where the construction is
performed.

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Notes On NHFS

Tips related to Online NHFS Transactions

Add Loan submission as usual while receiving application

Perform NHFS issue on date of payment of first installment

In loan issue, no need to select EMI interest rate.[Only 4 details are

wanted

to

add

with

amount(advance),

ISSUE.

ie,

Name of

Loanee,

Sanctioned

Period of repayment & Nature of Loan]

Disburse the required installment amount only through Loan Disbursement

menu
Deduct Charges(Administrative/processing) through GT,

if required.

Perform ADD-CHECK-PASS in loan disbursement menu.

After completion of all installments, perform EMI fixation as follows:
1. Select NHFS Loan issue form
2. Type Loan No & Press Enter key
3. Find out the required control number for prescribed EMI interest

rate.

4. Type the control number & press enter key-verify the EMI int. rate
Modify Yes

Authorise OK

Click on work sheet displayed at right extreme end of Loan issue

form
5. Are you want to Fix EMI ?
Yes
6.

EMI Work sheet displayed. Ensure its accuracy

7. Click on Pink arrow symbol-(return to Loan issue form)

Modify-Yes
Authorise-Ok
8. Check EMI through NHFS transaction menu[Ctrl W]

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Notes On NHFS

Re-fixation towards part payment & Premature closure in all aspects

should be strictly performed manually (Refer Cir. 101/2000)
Related Account Heads with Code Numbers in BAS:
Registration Charges NHFS[5810], NHFS Processing Charge[5803],NHFS
administrative

charges[5804],

NHFS

advance[5800],

Interest

on

NHFS[5801], Penal Interest in NHFS[5802], NHFS Retention Fund

Points to remember:
The loanee should complete the construction within 12 months of first
installment OR within 4 month of last inst.(whichever is earlier).
In the case of extension & renovation, the loanee should complete the
construction within 8 months of first installment OR within 4 month of
last inst.(whichever is earlier).
Completion certificate should be produced after construction/renovation
Simple interest due in between the disbursement of loan installments
should be remitted.
Due date of loan will be the date of payment of last installment.
Kindly advice the loanee to avail the last installment(first installment, in
case of purchase loan) in a convenient date for repayment. Since the
period may up to 240 months, it may entertain several issues towards
repayment.
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Notes On NHFS

Re-Fixation EMI is permitted, while remitting at least 10% of the

advance availed.
Date of Last re-fixation will be the due for subsequent installments.
Interest at the prescribed rate for minimum one year from the date of
fixation of EMI (in addition to simple interest collected, if any) is
charged on premature closing within one year
Down load NHFS table for arriving EMI for various periods.
It is strictly advice to keep manual personal ledgers.
The payments should be through a/c payee Cheque only.

Related HO Circulars:
29/95 Dated 08/11/1995 ,09/96 Dated 02/03/1996,17/96 Dated 17/05/1996,32/96 Dated
26/09/1996,22/97 Dated 30/04/1997, 03/98 Dated 06/01/1998 ,05/98 dated 07/01/1998
,101/2000 Dated 16/06/2000,13/2012 Dated 29/03/2012, 70/2013 dated 28/11/2013,
13/2014 dated 07/03/2014, 24/2014 Dated 21/05/2014, 1/2015 dated 8/1/15, 16/2015 dated
23/03/2015, 19/2015 Dated 25/3/2015, 25/2015 Dated 18/04/2015

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Notes On NHFS

Details of Company stationeries:

Form No Name
NHFS - I

NHFS Application Form

NHFS-II

NHFS Covering Abstract(not used now)

NHFS-III

NHFS Agreement

NHFS IV

NHFS Undertaking

NHFS-V

NHFS Letter of authorization

NHFS-VI

NHFS Certificate

NHFS-VII

NHFS Scrutiny Note

NHFS-VIII NHFS Pass Book

NHFS-IX

NHFS Personal Ledger

NHFS-XI

NHFS Receipt

NHFS-XIII NHFS Brochure

NHFS-XIV NHFS EMI table
With wishes,
Gireesh NV[3423] ,Assistant Manager, Kunnamangalam[198]
944 600 5115

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