Tamil Nadu Revises Housing Loan Limits for Urban Cooperative Banks

The Tamil Nadu government has revised the housing loan and mortgage loan limits for Urban Cooperative Banks (UCBs) and Urban Cooperative Credit Societies (UCCSs) to improve access to housing finance for eligible borrowers. Cooperation Minister V. Gandhiraj announced the revised guidelines, which include higher individual loan limits for certain cooperative institutions and an extension of the maximum repayment period to 20 years.

New Guidelines

Under the revised guidelines, Urban Cooperative Credit Societies with deposits of less than ₹100 crore can provide housing and mortgage loans of up to ₹60 lakh to an individual member. For societies with deposits exceeding ₹100 crore, the maximum individual loan limit has been increased to ₹1 crore.

The government has also extended the maximum repayment period for housing and mortgage loans offered by both Urban Cooperative Banks and Urban Cooperative Credit Societies to 20 years. The longer repayment period is expected to reduce the monthly instalment burden on borrowers and make it easier for eligible members to repay their loans.

For Urban Cooperative Banks, the maximum individual housing loan limit has been fixed at ₹60 lakh for banks with deposits below ₹100 crore and ₹1.40 crore for banks with deposits exceeding ₹100 crore. These limits are in line with the applicable Reserve Bank of India (RBI) guidelines.

The Cooperation Department found that some Urban Cooperative Banks were offering housing loans below the limits prescribed by the RBI, resulting in differences in lending limits among banks. To address this issue, the department has instructed the banks to offer loans up to the applicable maximum limits, subject to the prescribed guidelines and eligibility conditions.

The department has also directed Urban Cooperative Banks and Urban Cooperative Credit Societies to review and amend their existing loan policies and by-laws to incorporate the revised limits. The amendments must be submitted to the Regional Deputy Registrar for approval.

Minister V. Gandhiraj said eligible members could approach their respective cooperative banks or credit societies to apply for housing and mortgage loans under the revised guidelines. Applicants will need to submit documents such as identity proof, address proof, income certificates and relevant land or property documents.

The revised guidelines are intended to make housing finance more accessible through Tamil Nadu’s urban cooperative banking sector. The higher loan limits for eligible institutions and the extended repayment period may help borrowers finance property purchases while managing their monthly repayments more comfortably.

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