When you take home loan from a bank, you have to pay additional charges in addition to interest. Banks and financial institutions charge fees under various headings while the loan process is still in progress. As you may not know about these additional charges, this article provides detailed information on different headings under which you have to pay extra fee to the bank.
While taking a home loan, you have to pay a service charge to the bank. Different banks and financial institution have different service charge. However, they cannot charge more fee than prescribed by Nepal Rastra Bank. Commercial banks can charge a service fee of up to 0.75 percent. Similarly, development banks can charge up to 1 percent. While finance companies and microfinance institutions can charge up to 1.25 and 1.50 percent respectively. Nevertheless, microfinance companies cannot invest in real estate in Nepal.
Banks have been taking service charge within the limits. Some banks are also offering loans at a service fee of 0.25 percent. If you can bargain, you can also reduce the service charge too.
CREDIT INFORMATION FEE
You have to pay a credit information fee at the beginning of taking home loan. The bank will charge the same fee as the credit information center. This fee varies according to your loan history. If you have taken a loan from other banks previously, the information will be longer. The more information is added, the more fees the customer has to pay. Generally, you have to pay 500 rupees to the credit information center.
You have to pay to valuator as when you do valuation of the property, it goes to mortgage. Banks and financial institutions already have their own valuator engineer for collateral evaluation. They reach the field as per the request of the bank and assess the collateral and set the limit for the flow of loan.
However, money for collateral valuation does not have to be returned to the bank. The valuator charges a collateral valuation according to the fair market value of the property. Generally, valuator charges Rs 5,000 to Rs 10,000 for valuing a mortgage.
Mortgage fee is another home loan charges you have to pay. You need to visit land registration office for mortgaging the property after all the documentations are ready. There you will need to pay a certain amount as mortgage fee.
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