How Much a Bengaluru Buyer Really Puts Down: The RBI LTV Rule
The RBI loan to value cap decides how much of a home you can borrow, from 90 percent down to 75 percent by loan size, with stamp duty outside the loan. Here is how a Bengaluru buyer works out the real cash needed.
A software engineer in Electronic City had done the sums, or thought so. The flat was 80 lakh rupees, the bank had spoken of an 80 percent loan, and so the plan was to arrange 16 lakh and borrow the rest. On the day the sanction letter arrived, the numbers did not match. The loan was smaller, the down payment larger, and a big stamp duty bill sat entirely outside the loan. Nothing had gone wrong. The buyer had simply misread how the loan to value rule actually works.
The short answer. The Reserve Bank of India caps how much of a home's value a lender may finance. The loan can be up to 90 percent of the property value for loans up to 30 lakh rupees, up to 80 percent between 30 and 75 lakh, and up to 75 percent above 75 lakh. Stamp duty and registration are not counted in the value the loan covers, so you fund them yourself. The trade-off is real. A higher loan means a smaller down payment now but larger interest over the years, and the cap means you must always arrange a meaningful sum from your own pocket before the loan does its part.
What is the loan to value ratio, and why does the RBI cap it?
The loan to value ratio, or LTV, is the share of a property's value that a lender is allowed to finance. If a flat is worth one crore and the LTV is 75 percent, the most the bank can lend against it is 75 lakh, and the remaining 25 lakh is your down payment. The RBI sets these caps as a prudential rule so that every borrower has real money of their own in the home, which lowers the risk to the banking system and to the borrower.
For a buyer, the cap is not a bank being difficult. It is a regulatory ceiling the bank cannot cross, however strong your income. A lender may choose to offer less than the cap, but it can never offer more, so the LTV is the upper bound on your borrowing against a given property. Understanding this early stops you from planning around a loan the rules will not permit.
The rule also nudges buyers toward homes they can genuinely afford. Because you must bring a fixed slice of the price in cash, the LTV quietly tests whether you have the savings a purchase of that size demands. A buyer who has to stretch even to meet the down payment is being told something useful about the size of the commitment.
What are the LTV slabs for a Bengaluru buyer?
The cap changes with the size of the loan, in three broad slabs. For loans up to 30 lakh rupees the LTV can be as high as 90 percent, for loans between 30 and 75 lakh it is up to 80 percent, and for loans above 75 lakh it is up to 75 percent. Most Bengaluru apartment buyers fall into the second or third slab, which is why an 80 or a 75 percent loan is the common reality rather than the 90 percent figure people remember.
The table below sets out the slabs and what each one means for the minimum down payment on the loan side. Remember that these are ceilings, and your own lender may apply a lower ratio based on its assessment of you and the property.
| Loan amount | Maximum LTV | Minimum own share of value |
| Up to 30 lakh rupees | 90 percent | 10 percent |
| Above 30 up to 75 lakh | 80 percent | 20 percent |
| Above 75 lakh | 75 percent | 25 percent |
| Stamp duty and registration | Not financed | Paid fully by you |
Why are stamp duty and registration not covered by the loan?
The LTV cap is applied to the property value alone, and stamp duty, registration, and documentation charges sit outside it. This is the part that catches buyers off guard. In Bengaluru those charges run to several percent of the value, so on a large flat they are lakhs of rupees that the loan will not touch and that you must arrange in cash on top of the down payment.
There is a narrow exception. For small loans up to 10 lakh rupees, lenders may include stamp duty and registration in the property cost for the LTV calculation, which helps modest buyers. For the apartment prices common in Bengaluru, though, you should assume these charges are yours to fund separately. Our guide on Bengaluru stamp duty, registration and the guidance value floor sets out exactly how much that is.
Add to this the other charges a purchase carries, from parking and clubhouse fees to legal and documentation costs, and the cash you need beyond the loan grows further. Treating the down payment as your only upfront cost is the single most common budgeting mistake, and the LTV rule is the reason it is a mistake.
Why might the bank lend less than the cap?
A lender bases the loan on its own valuation of the property, not on the price you agreed with the seller. If the bank values the flat below your negotiated price, it applies the LTV cap to that lower figure, and your loan shrinks accordingly while your down payment grows to fill the gap. On a resale flat in particular, the bank's valuation can lag the price a seller commands in a hot micro market.
Your own profile matters too. The bank also checks how much of your income already goes to other loans, and it may cap the loan on that basis even when the LTV would allow more. Between the property valuation and your repayment capacity, the actual sanction is often below the headline LTV. This is why the interest cost over time deserves as much attention as the down payment, a theme we cover in our guide on the home loan EMI at the current repo rate.
The practical lesson is to get the bank's valuation and an indicative sanction early, before you commit to a price or pay a large token. If the valuation comes in low, you want to know while you can still renegotiate or rethink, not after your token money is at risk.
How do you work out the real cash you need?
Build the number from the ground up rather than from the loan down. These steps turn the LTV rule into a concrete figure for the cash you must arrange before the loan covers the rest.
- Take the property value the bank will use, which may be its valuation rather than your agreed price.
- Apply the LTV slab for your loan size to find the maximum the bank can lend.
- Subtract that maximum loan from the value to get your minimum down payment.
- Add stamp duty and registration charges in full, since the loan does not cover them.
- Add the other purchase charges such as parking, clubhouse, legal, and documentation fees.
- Add a buffer in case the bank's valuation comes in below your agreed price.
- Confirm the total against your savings before you pay any token or sign an agreement.
Run this once and the picture becomes honest. For a project like Shriram Summitt in Electronic City, a buyer who works the number this way knows the exact cash to keep ready, rather than discovering it at the sanction stage.
How does the down payment shape your buying plan?
The LTV cap effectively sets a floor under your savings for any given home. Because the loan can never cover the whole price and never covers the charges, the price you can realistically target is tied to the cash you can assemble, not only to the EMI you can afford. A buyer with a strong income but thin savings is often constrained more by the down payment than by the monthly instalment.
That reframes the planning. Instead of asking only how large an EMI you can carry, ask how much cash you can bring on day one, then work backward to the price band that fits. Done in that order, the LTV rule stops being an unpleasant surprise in the sanction letter and becomes the first number in a sound plan. It also protects you from overreaching, because a home that leaves you with no savings at all after the down payment is a real risk even when the monthly EMI looks perfectly comfortable on paper.
What do Bengaluru buyers ask most about LTV and down payments?
How much can I borrow for a home in Bengaluru under RBI rules?
The RBI caps the loan at 90 percent of the property value for loans up to 30 lakh rupees, 80 percent for loans between 30 and 75 lakh, and 75 percent above 75 lakh. The rest is your minimum down payment. A lender can lend less than the cap, but not more, so plan for at least that gap.
Are stamp duty and registration included in the loan?
No, in most cases. The loan to value cap is applied to the property value alone, and stamp duty, registration, and documentation charges are excluded, so you fund them yourself on top of the down payment. Only for small loans up to 10 lakh rupees can these charges be included. Budget for them as separate upfront cash.
Why does the bank value the flat lower than my agreed price?
A lender bases the loan on its own valuation, which can be lower than your agreed price, and it applies the LTV cap to that figure. If the valuation is below what you are paying, your loan shrinks and your down payment grows to cover the gap. Ask for the valuation early so the shortfall does not surprise you.
How much cash should a Bengaluru buyer keep ready?
Plan for your down payment of at least 10 to 25 percent of the value depending on the slab, plus stamp duty and registration, plus other charges and a valuation buffer. In practice many Bengaluru buyers need well over a quarter of the price in their own funds before the loan covers the rest, so arrange this early.
Last updated 2026-09-13. PropNewz Team.
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