Non-resident Indians (NRIs) are usually very apprehensive while purchasing immoveable property in India,their home country. This is a remnant from the old days when purchase of property by NRIs was covered under the foreign exchange laws.With the enactment of the Foreign Exchange Management Act (FEMA),the foreign exchange laws have been modified and diluted significantly,but the excesses of the erstwhile Foreign Exchange Regulation Act (FERA) have deterred many NRIs.This article covers the prevalent provisions in respect of purchase of immovable property by NRIs in India. The Reserve Bank of India (RBI) has issued a notification granting general permission to NRIs for purchase of certain immovable properties in India without obtaining any clearance from the central bank.Types of properties where NRIs can invest : The RBI permission does not grant power to acquire any and every property in India. NRIs are allowed to purchase only residential or commercial property. This means they cannot purchase agricultural land or plantation property. Since many NRIs aspire to own a farmhouse,but under the existing dispensation,this is not allowed. However,there is no restriction on the number of residential or commercial property that can be acquired.Financing the purchase: The payment for purchase of property can be made by way of remittance through banking channels from abroad or from money lying in their NRE / NRO or FCNR accounts. The money for purchase of the permitted properties has to come only through banking channels hence the payment cannot be tendered in the form foreign currency notes. NRIs are even allowed to finance the purchase with home loan in rupees.Servicing the home loan: As far as payments of EMI for the home loan taken in Indian currency in India is concerned,the same can be done either by direct remittance from abroad or from the money lying to the credit in NRE/NRO/FCNR accounts. In addition to the above sources,the home loan can even be serviced out of the rents received from such property or money transferred to borrowers account from the account of relatives of such borrower.In case the NRI is buying the property for the purpose of his own residence,the NRI can even take loan against deposits lying in their FCNR or NRE account upto an amount of Rs 1 crore for the purpose of servicing the home loan.Joint ownership: The property to be purchased by an NRI can either be purchased in single name or jointly with any other NRI. It may be noted that that a resident Indian,or a person who is otherwise not allowed to invest in the property in India,cannot be made a joint owner in such property even though the second named person might not even be contributing any money towards the property.Continuance of ownership : Many prospective NRIs are worried about what would happen to the properties,which they already own. There is nothing to worry about for such properties. A person who owns a property when he becomes an NRI can continue to hold the property in his name. It is interesting to note here that such resident Indian becoming an NRI is even allowed to continue to own agricultural land,plantation property or farm house which he is otherwise not allowed to purchase after migrating abroad. An NRI is allowed to let out the property,which he owned prior to moving abroad,without taking permission from RBI. An NRI is even allowed to get the money sent back outside India after appropriate taxes have been paid in India from rent so received.It is now clear that the laws have undergone a change and it is not a hassle for NRIs to own property in their home country.— The author is CFO,Apnapaisa.com