Eligibility

• Owners who have let out or propose to let out their premises to Reputed Companies/institutions, Public Sector Undertakings/Established Commercial Organizations/Multinationals/Banks.
  
  
• Landlords of Bank of Baroda Branch/Office premises.
  
  
• Landlords of residential flats/houses leased out to Bank of Baroda for Officers/ Executives quarters.

Note: The facility should be made available only to resident customers and not to NRIs.

Purpose

• For meeting the expenses of renovation/alteration/addition to the premises rented, and other business /personal needs but not for speculative purposes.

Limit

• 80 % of rent (net of TDS, advance rent, security deposit), due and receivable, for the unexpired certain period of lease.
              OR
• Loan, which can be recovered/repaid through monthly rent (net of TDS, advance rent, security deposit), due and receivable, as an ‘Equated Monthly Installment (EMI) ’ for the unexpired period of lease.
  
  Whichever is low.
  
  Subject to:
  • Minimum : Rs.00.01 Crore.
    
    
  • Maximum : Rs.10.00 Crores.
  
  
• Suitable higher margin of 5% to 10% may be stipulated where a higher risk is perceived.

Rate of Interest

• Interest to be charged at 2.50% over BPLR with monthly rests.

Repayment

• Loan to be repaid in ‘Equated Monthly Instalments (EMI)’ with a maximum period of 10 years or unexpired period of lease, whichever is less. Repayment to commence one month after disbursement.

Security

• For loans upto Rs.5.00 lacs:
  Assignment of future rent receivables and third party guarantee acceptable to the Bank. Such loans should be classified as 'unsecured' and sanction should be as per discretionary lending powers for unsecured advances.
  
  
• For Loan above Rs.5.00 lacs:
  In addition to assignment of future rent receivables, mortgage of the leased properties or any other immovable properties and/or pledge of NSC, KVP, IVP etc. the aggregate value of which should be at least 1.5 times the loan amount. This requirement may be reduced to 1.25 times in deserving cases at Corporate Office level.
  
  
• Tripartite Agreement amongst the Bank, the borrower and the tenant/lessee providing for payment of the rent directly to the Bank.
  
  Wherever Tripartite agreement is not feasible such as in the case of Government Departments/Public Sector Units/Multinational Companies, sanctioning authority should stipulate that suitable letter from borrower for collecting rent direct to be obtained and lodged with tenant/lessee and undertaking from tenant/lessee to pay such rent direct to Bank should be obtained.

Processing Fee

• One time processing fee @ 0.50% of the loan amount with Minimum of Rs.1000/- and maximum of Rs.1.00 lac

Insurance

• Insurance for full market value of properties in the name of borrower(s) to be mortgaged to Bank with Bank clause. Insurance to cover risks such as fire, riot, earthquake etc.

Documents

• Loan application.
  
  
• Certified Copy of Lease deed.
  
  
• Proof of income for applicant and lessee.
  
  
• Copy of IT Return.
  
  
• Certified copies of title deeds of the properties leased out and mortgaged, along with latest tax receipts.
  
  
• Copy of approved building plan.
  
  
• Tripartite Agreement amongst the Bank, the borrower and the tenant/lessee providing for payment of the rent directly to the Bank.
  
  OR
  
  
• Letter from borrower for collecting rent direct and letter of undertaking from tenant/lessee to pay rent direct to Bank, whenever Tripartite agreement is not feasible.

Note: Certified copies of Lease Deed, Tripartite Agreement, Letter of Authority and Letter of Undertaking from tenant/lessee are to be got vetted by Legal Department/Bank's Legal Adviser, besides scrutiny of title to property by Bank's Legal Adviser.

To know the current interest rates Click here.

For further details, please contact the Bank of Baroda Branch nearest to you.



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