Banking · Housing Finance
Why do banks generally not impose an upper ceiling on loans for construction or purchase of a house/flat?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1Because repayment capacity of borrowers is not assessed in housing loans
- 2Because RBI mandates unlimited lending in housing finance
- 3Because housing loans are secured against immovable property, making large-value lending relatively safe✓
- 4Because housing loans are risk-free and require no due diligence
Correct answer
Because housing loans are secured against immovable property, making large-value lending relatively safe
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