MCLR vs. RLLR
MCLR (Marginal Cost of Funds based Lending Rate): An older internal benchmark used by banks. Rates reset typically once a year.
RLLR (Repo Linked Lending Rate): The new external benchmark. Your Home Loan rate moves directly with the RBI Repo Rate. It is more transparent and transmits rate cuts faster.
LTV (Loan to Value) Ratio
The percentage of the property value the bank is willing to fund. For loans up to ₹30 Lakhs, LTV can be 90%. For loans above ₹75 Lakhs, it is usually 75%. You must pay the rest.
Sanction Letter
An official document from the bank stating your loan is approved, subject to property verification. It mentions the loan amount, tenure, and rate. It is valid for 6 months.
Disbursement
The actual release of funds. For resale flats, it's a lump sum. For under-construction properties, it is "tranche-based" (linked to construction stages).
Pre-EMI
Interest paid on the partially disbursed loan amount during the construction phase. You don't pay principal during this time. It increases the total cost of the loan.