LTV and Down Payment: How Much a Bengaluru Buyer Must Put Down
The RBI caps home loan LTV at ninety percent up to thirty lakh, eighty percent up to seventy five lakh, and seventy five percent above that, and stamp duty is not financed. Here is how a Bengaluru buyer plans the real down payment.
A Bengaluru buyer eyeing a one crore flat in Yelahanka in September 2026 had carefully saved twenty percent for the down payment, only to discover the bank would lend at most seventy five percent of the value, and that the stamp duty and registration were entirely on him. The gap between what he had saved and what he actually needed on the day was larger than he expected, and it was all knowable in advance. How much a lender will finance, and how much you must bring yourself, follows rules a buyer can read before ever visiting a bank.
The short answer. The Reserve Bank of India caps how much of a home's value a bank can lend, at ninety percent for a property up to thirty lakh rupees, eighty percent up to seventy five lakh, and seventy five percent above that. The rest is your down payment, and on top of it you separately fund the stamp duty, registration, and other charges, which are not included in the value the loan is measured against. The trade-off is simple to plan for: know your slab, add the taxes, and you know the real cash you need before you commit.
What is the loan-to-value ratio?
The loan-to-value ratio, or LTV, is the share of a property's value that a lender will finance through a loan. If a bank lends eighty percent of a flat's value, the LTV is eighty percent, and you fund the remaining twenty percent yourself as the down payment. Lenders use LTV to manage risk, because a larger down payment from the buyer means the bank is lending against a bigger cushion of the buyer's own money. The higher your down payment, the lower the LTV, and the lower the risk the lender carries on the loan.
For a buyer, LTV is really a statement about how much cash you must bring to the table. It sets the floor on your down payment, and understanding it early is the difference between saving the right amount and being caught short on the day of registration.
What are the RBI caps on how much I can borrow?
The Reserve Bank of India sets maximum LTV ratios that banks must stay within, and they step down as the property value rises. For a property valued up to thirty lakh rupees, a bank can lend up to ninety percent of the value. For a property between thirty lakh and seventy five lakh, the cap is eighty percent. For a property above seventy five lakh, it is seventy five percent. These are ceilings set by the regulator, and they mean a more expensive home requires a proportionally larger down payment from the buyer.
The official source for these norms is the Reserve Bank of India, whose guidelines are published on rbi.org.in. The table below shows the caps and the minimum down payment each implies, so you can see at a glance what your slab requires.
| Property value | Maximum LTV | Minimum down payment |
| Up to thirty lakh | Ninety percent | Ten percent of value |
| Thirty lakh to seventy five lakh | Eighty percent | Twenty percent of value |
| Above seventy five lakh | Seventy five percent | Twenty five percent of value |
| Stamp duty and registration | Not financed | Funded by the buyer |
| Actual sanction | May be below the cap | Depends on the lender |
How much down payment will I actually need?
Your down payment is the part of the value the loan does not cover, so it is ten, twenty, or twenty five percent depending on your slab, and that is before the taxes. On a one crore flat, which sits in the top slab, the loan is capped at seventy five percent, so seventy five lakh, leaving a twenty five lakh down payment. That is the floor, not the whole story, because the stamp duty and registration come on top of it. A buyer who saves only the down payment and forgets the taxes will find the day of registration more expensive than expected.
The practical move is to compute the down payment from your slab, then add the stamp duty, registration, and any other charges, and treat the total as the real cash you need. Knowing this number early lets you either save toward it or adjust the price band you are shopping in, rather than discovering the shortfall at the last moment. It is also the number to have in hand before you pay a booking amount, because a booking is far easier to make than to unwind, and a buyer who has run the full sum is far less likely to over commit on the strength of a loan that turns out smaller than assumed.
Are stamp duty and registration covered by the loan?
No. The LTV is measured against the value of the property, and stamp duty, registration, and other documentation charges are not included in that value, so the loan does not finance them. This is one of the most common surprises for a first time buyer, because it means the government charges you pay to register the property are entirely out of your own pocket, over and above the down payment. On a large purchase, those charges are a meaningful sum in their own right.
This is why the registration cost belongs in your cash plan from the start. For how those charges are calculated in Karnataka, and the value they are charged on, see our guides on guidance value and your stamp duty base. Budgeting the down payment and the taxes together is the only way to know the true upfront cost of the flat.
Should I put down more than the minimum?
Often, yes, if you can, because a larger down payment shrinks the loan, the interest, and the risk. Putting in more than the minimum reduces the principal you borrow, which lowers both your monthly payment and the total interest you pay over the life of the loan. It also lowers your LTV, which can sometimes help you secure a better interest rate, since a lender is lending against a bigger cushion of your own money. For a buyer who has the savings, a bigger down payment is one of the simplest ways to make a home cheaper over time.
The balance to strike is between the down payment and your emergency reserve. It rarely makes sense to empty your savings entirely into the down payment and leave nothing for repairs, medical costs, or a few months of expenses if income stops. The sensible middle is to put down comfortably more than the minimum where you can, while keeping a cushion you would not want to borrow expensively for later. This is buyer guidance, not investment advice, and the right split depends on your own finances.
Why might my lender offer less than the cap?
The RBI caps are maximums, not entitlements, so a lender may offer less based on your income, your credit profile, and its own valuation of the property. The bank assesses how much you can repay from your income, often keeping your total loan payments within a share of your monthly income, and it lends against the lower of the agreed price or its own valuation. So even if the cap allows eighty percent, your sanctioned loan can be less, which raises the down payment you must bring. A strong credit score and a stable, well documented income help you get closer to the cap the rule allows.
This is why the loan you are eligible for is a separate question from the maximum the rule allows. For how your credit profile affects approval and the amount, see our guide on the CIBIL credit score and home loan approval, and for the repayment flexibility once the loan is running, our note on prepayment and foreclosure charges. A buyer weighing a project such as Embassy Boulevard in Yelahanka would confirm both the cap and the likely sanction before fixing a budget.
A seven step down payment plan
Use this order before you fix a budget or pay a booking amount on a flat.
- Estimate the property value and find your LTV slab.
- Apply the cap to get the maximum loan for that slab.
- Compute the down payment as the value minus the maximum loan.
- Add the stamp duty, registration, and other charges separately.
- Treat the total as the real cash you need upfront.
- Check your likely sanction against your income and credit profile.
- Save toward the full figure, or adjust the price band you shop in.
Frequently asked questions
How much of a home's value can a bank finance? Under the RBI caps, up to ninety percent for a property valued up to thirty lakh rupees, eighty percent for thirty to seventy five lakh, and seventy five percent above that. These are maximums, so the rest is your down payment, and a more expensive home falls in a lower slab and needs a proportionally larger down payment.
Does the loan cover stamp duty and registration? No. The LTV is measured against the property value, and stamp duty, registration, and documentation charges are not part of that value, so the loan does not finance them. You fund those charges yourself, over and above the down payment. On a large purchase they add a meaningful sum, so include them in your cash plan from the start.
Will my bank always lend the maximum allowed? Not necessarily. The RBI caps are ceilings, and a lender may sanction less based on your income, your credit profile, and its own valuation. Banks lend against the lower of the price or their valuation and keep repayments within a share of your income, so your actual loan can be below the cap, raising the down payment you must arrange.
How do I work out my down payment? Find your LTV slab from the property value, apply the cap to get the maximum loan, and subtract it from the value to get the minimum down payment. Then add the stamp duty, registration, and other charges, which the loan does not cover. The sum of the down payment and those charges is the real upfront cash you need.
Last updated 2026-09-19. PropNewz Team.
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