How much can you borrow for a home loan in Nepal, and what documents do you need?

For most Nepali families, buying a house means taking a home loan. The process looks complicated from outside, but banks follow a fairly predictable logic. Once you understand how they think, you can prepare properly and improve your chances.

How do banks in Nepal decide how much you can borrow?

Three things drive the decision: the value of the property, your income, and your credit record. Your age matters too, because it sets how long the loan can run.

The value of the property

Banks lend a share of the value assessed by their own valuator, not the price you agreed with the seller. If the valuation comes in lower than your purchase price, you must cover the difference yourself.

The maximum share that a bank may lend is limited by the rules of Nepal Rastra Bank, and those rules are revised from time to time. Ask your bank what limit applies to your loan today, rather than relying on a figure a friend was given last year.

Your income

Banks look at how much of your monthly income the instalment would consume. They want to be confident you can pay comfortably, not barely.

Stable, documented income is far more useful than high but irregular earnings. A modest salary paid into the same account every month is easier to lend against than a larger business income with no clear records.

Your credit record

Banks check your borrowing history through the national credit information system. Missed payments on an earlier loan or a credit card can reduce your limit or stop the application entirely.

Your age and the loan term

Your age affects how long the loan can run. A longer term means a smaller instalment, which raises the amount you can borrow. An older applicant may be offered a shorter term, and so a lower limit, on the same income.

What personal documents do you need for a home loan?

Every applicant needs proof of identity and a completed application. Requirements vary slightly by bank, but most ask for the following.

• Citizenship certificate (नागरिकता प्रमाणपत्र).
• Recent passport-size photographs.
• The bank's completed application form.
• The spouse's documents, which married applicants are often asked for.
• A guarantor's papers, if the bank asks for one.
• Details of any existing loans, with recent statements.

What income documents do you need?

That depends on how you earn. Salaried applicants prove income through their employer and bank, business owners through registration and tax records, and remittance earners through whatever proof the bank accepts for money from abroad.

What property documents does the bank need?

The bank needs papers that prove the property is legally owned, correctly mapped and properly built. A bank will reject a property with unclear ownership, no legal access road, or missing construction approval.

• A copy of the Lalpurja (लालपुर्जा), the land ownership certificate.
• The survey map, or naksa (नक्सा), from the Survey Office (नापी कार्यालय).
• The latest Malpot tax receipt (तिरो रसिद), showing land revenue is paid up.
• The approved building drawing, where a house is involved.
• The construction approval from the local body (municipality or rural municipality).
• A copy of the sale agreement with the seller.
• The bank's own valuation report, which the bank arranges.

Collect what you can from the seller before you apply. Missing pages at this stage slow everything down. Our guide on how to check a Lalpurja explains what to confirm at the Malpot / Land Revenue Office (मालपोत कार्यालय) before you hand it to the bank.

In what order should you apply for a home loan?

Start the loan conversation before you commit to a seller. Knowing your real borrowing limit changes the way you shop.

1. Gather your personal and income documents.
2. Visit two or three banks and ask what you could borrow on your income.
3. Shortlist properties within that range and collect their documents.
4. Check the property yourself at the Malpot office before paying any bayana / token money (बैना).
5. Apply to the bank you prefer and let its valuator visit the property.
6. Compare the final offer, including all charges, before you sign.

How can you improve your chances of approval?

Reduce what you already owe, make your income easy to prove, and borrow less. The rest is comparing banks.

• Clear small existing debts before applying, because every running instalment reduces your capacity.
• Keep your salary flowing through one bank account so your income is easy to prove.
• Save a larger down payment, since a smaller loan is easier to approve.
• Apply to more than one bank and compare offers, because terms differ.

What does a home loan really cost beyond the interest rate?

Ask each bank for the full cost, not only the interest rate. Processing fees, valuation charges, insurance and prepayment terms all affect what you actually pay.

Several of these are usually deducted before the loan reaches you, so plan for that gap in your cash. Our guide to the real cost of buying land in Nepal lists them alongside the registration and survey costs.

What questions should you ask each bank?

Ask the same questions at every bank and write the answers down, so you can compare like with like. A loan officer who will not answer them clearly is telling you something too.

1. What is the most you would lend me on my income, and for how long?
2. How will you value the property, and who pays for the valuation?
3. Is the interest rate fixed or does it change, and how often is it reviewed?
4. What is the total of all fees and charges, and which are deducted before release?
5. Is insurance required, and can I choose the insurer?
6. What does it cost to repay early, in part or in full?
7. How long does approval usually take once every document is in?
8. Which of my income documents would you not accept?

Do not sign the seller's agreement with a payment date you cannot meet. If the bank needs several weeks for valuation and approval, agree a registration date with the seller that allows for it.

Why check the property before you check the loan?

Because the bank's rules about the property protect you as well. If a bank will not accept the property as security, ask yourself why you would accept it as a purchase.

Our list of red flags when buying property covers the problems a bank is most likely to find, so you can spot them first.

Where can you find a property that is ready for the bank?

MeroBhumi lists houses and apartments and land across Nepal. Listings marked verified on MeroBhumi have had their ownership documents reviewed by our team. It is a strong first check, not a replacement for your own visit to the Malpot office, but it helps you walk into the bank with your papers in order.