IOB Unveils ‘Easy Plot’ Loan Scheme for Residential Land Buyers

Today, on the 11th of July, Indian Overseas Bank (IOB) inaugurated a new set of retail loans under the scheme IOB Easy Plot for its customer segment interested in buying approved residential plots for the future construction of houses. This innovation is in response to the growing demand for flexible housing finance products.

The scheme provides loans for land purchases that are approved by government development authorities, statutory bodies, reputed builders, or private colonies registered by the RERA. This scheme is targeted at resident Indians as well as NRIs between the ages of 21 to 60. The sale allows for applicants aged over 55 to apply together with any spouse or legal heir as co-applicant.

IOB Easy Plot is maintained within the ambit of the SARFAESI Act such that the site is to be marketable and, therefore, conveniently legally transferable. In semi-urban areas, the loan will range from ₹10 lakh to ₹100 lakh; in urban or metro centers, it may extend to ₹300 lakh, with at least a 25% margin on the plot value.

Repayment facilities can be availed for a maximum period of 15 years, or up to whichever one time the borrower attains an age of 70 years. A vital condition is to submit a notarized declaration on beginning construction within five years or within such time frame as the local authorities may permit; otherwise, the loan would be shifted to commercial interest rates.

The interest will be linked to the bank’s RLLR (Repo Linked Lending Rate), and also will also be reviewed based on the borrowers’ CIBIL score. After the construction is completed, the borrowers may switch to IOB housing loan rates by providing proof of completion along with a re-evaluation of the CIBIL score.

This scheme would give a structured and transparent process for financing the buying of residential plots, said IOB MD & CEO AJ Kumar Srivastava at the launch, adding that it would also extend IOB’s presence into a largely uncharted market, thereby enhancing its retail lending portfolio.

The legal clearance for the property is to be obtained from a bank-approved lawyer. The legal verification must be provided for valuation reports and CERSAI registration. The property must have a clear demarcation, road access, and inspections carried out prior to sanction and afterwards.