Finance
Housing Loan for Migrant Workers
House of your own is everybody’s dream. You sacrifice your precious time, leisure to make this dream a reality. Perhaps it may be the main reason you are working abroad, to earn something to build a house to live with your loved ones. You don’t have to wait until you return back to start constructing your dream house. Many Sri Lankan Banks now, offer housing loan facilities with a host of special concessions to enable Sri Lankan migrant employees abroad to obtain housing loans. I am going to describe the procedure at National Savings Bank’s Housing Loan scheme as it has many value added features compared to other Banks. Who are eligible to request for a Housing Loan?
  • Permanently employed abroad and in receipt of a monthly salary.
  • Employed abroad on contract basis and in receipt of a monthly salary.
  • Self-employed abroad and in receipt of a monthly income.
What are the documents need to prove my eligibility?
For those who employed in Italy For those who employed in other countries
1.A Letter from employer (with English Translation) confirming the following.i) Designation ii)Whether confirmed or not iii)Monthly Salary   1.A Letter from employer confirming the following.i) Designation ii)Whether confirmed or not iii)Monthly Salary
2.Service Contract (if any) with English Translation 2.Service Contract
3.Pay slips for the last 6 or at least 3 months with English translation for the last one.House maids can submit the receipts of tax paid by the employer for the last two quarters. 3.Pay slips for the last 6 months
4.Soggiorno 4.VISA Copy
5.Passport Copy 5.Passport Copy
6.Identity card issued by Italy 6.If work in a ship/vessel - CDC
7.Bank Accounts Statements for the last six or at least three months with English Translation for the last one. 7.Bank Accounts Statements for the last six months .
  What else I should do upon eligible to apply for the Loan?
  • Open a NRFC/RFC Account at the Bank
  • Appoint a Power of Attorney to act on behalf of yourself and ask him to keep the original with two photo copies of the same to attend at Bank when necessary.
For what purpose can I apply a Loan?
  • To construct or purchase a house of your own.
  • To purchase a block of land to build a house.
  • To complete construction of a new house or for extensions/repairs of an existing house.
  • To repay a loan obtained from a recognized financial institution for housing purposes.
What is the maximum amount I can apply? It depends on following conditions.
  • Nature of the applicant's contract of employment and his repayment capacity.
  • Age of the applicant.
  • Value of the property to be mortgaged.
  • Purpose of the loan applied.
  • For those who employed in Italy, Loan installment equivalent to 50% of Net Income.
In case of persons, working abroad without a formal contract or on self-employed basis, they will also become eligible for a housing loan under the "Ithurum Niwasa" housing loans scheme. Any person who wishes to obtain a housing loan under this scheme will be required to open an "Ithurum Niwasa" savings account. The period of repayment will be determined by taking into consideration the nature of the contract of the employment. The maximum loan amount that could be obtained under the "Ithurum Niwasa" Savings Scheme will be Rs.1 Mn. irrespective of the purpose. What is the repayment period?
  • The repayment period is 05 years. However, this could be extended up to 10 years,            depending on the nature of the contract of the employee.>
  • The maximum age limit before which you should complete your repayment of the loan is   65 years.
What is the security I should provide against the Loan? The house/land to be constructed / purchased or the house to be completed/repaired/extended, or another immovable property should be mortgaged to the Bank as a security for your loan. What are the other documents needs for the Loan?
  • Local authority documents.(Street Line, Assessment Tax paid, Ownership, Non Vested)
  • Extracts from the land registry
  • Approval of survey plan.
  • Title report
What are the expenses to be borne?
  • Valuation fee.
  • Inspection fee.
  • Credit Information Bureau fee.
  • Mortgage Bond registration fee.
  • Title Insurance Policy fee (if applicable).
  • Fire Insurance Policy fee (if applicable).
  • Service charges
What are the Value Added Services I can get? If you are unable to attend to prepare the documents need for the loan, the bank will arrange them for you for a nominal fee. The Documents arranged by this service limited to Local authority documents, Extracts from the land registry, Approval of survey plan and Title report. The fee you have to pay calculate as follows.
  • Up to Rs 1,000,000/- (Minimum)9,000/-
  • Rs. 1,000,000/- -- 2,000,000/- 10,000/-
  • Rs. 2,000,000/- -- 2,500,000/- 11,500/-
  • Over Rs 2,500,000/- (Maximum)15,000/-
What is the Interest Rate?
  • Loan amount up to Rs. 500,000/- 10% p.a
  • From Rs.500,001- to Rs.1,000,000/- 12% p.a
  • Above Rs.1,000,001/- 12.5% p.a
What if I cannot produce any document in support to prove my income? For migrant worker community who are not in a position to produce documents in support of income. There is a special project launched by NSB in collaboration of Sri Lanka Bureau of Foreign Employment called "Sarani".You can apply for a maximum of Rs. 300,000/- as a loan at a nominal interest rate of 5% and repayment period will be a maximum of 5 years. So your Housing dream is not a dream any more. If you need more information you could get in touch with the Bank Staff through their Hot Line +94112379379 or visit their web site.

Sandun W

Sandun joined Lanka Help Magazine as a contributor in June, 2011. He has been consistently writing articles to our magazine. Many useful articles of this site are under Sandun's name.

About the author

Sandun joined Lanka Help Magazine as a contributor in June, 2011. He has been consistently writing articles to our magazine. Many useful articles of this site are under Sandun's name.

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1 Comment

  1. IrandaK

    Thank you for the info.It was very useful!

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