Most Nepali families do not buy a house with cash. They buy it with a home loan and years of steady EMIs. If you are planning to do the same, the good news is that the path is well worn and the rules are clearer than they used to be.

Here is the short version. You get your finances and documents in order. You find a property with a clean Lalpurja. The bank values it and approves your loan. You register the sale and the mortgage at the Land Revenue Office, and the bank pays the seller. That is the whole journey. The detail is where people trip up, so this guide walks through each stage.

Quick answer: buying a house with a home loan in Nepal

Buying a house with a home loan in Nepal usually runs like this:

1. Check your eligibility and rough budget before you shop.
2. Get pre-qualified by a bank so you know your loan ceiling.
3. Find a property and verify its documents.
4. Let the bank’s valuer assess the property.
5. Submit the full loan application with all documents.
6. Wait for legal checks and the sanction letter.
7. Sign the loan agreement and register the mortgage (dhito) at the Land Revenue Office.
8. The bank disburses the loan, and you start paying EMIs.

Start to finish, a clean case takes about 15 to 30 days at the bank stage, according to lender guidance published in 2026 (PriceNepal, July 2026). Delays almost always come from missing papers or a title problem, not the bank being slow.

How much can you borrow? LTV rules in 2026

The Loan-to-Value ratio, or LTV, is the share of the property’s value a bank will lend. Nepal Rastra Bank sets the ceiling, and the rest is your down payment.

As part of the monetary policy for FY 2082/83, NRB raised the ceiling for first-time home buyers. A first-time buyer can now borrow up to NPR 3 crore (NPR 30 million) with an LTV of up to 80 percent. That 80 percent comes with conditions. The house or apartment must not be larger than 3,000 square feet. You must not have taken a housing loan before. You cannot use rental income as your source of repayment. And if interest rates go up later, your agreed installment is not supposed to rise beyond what was set.

If you are buying a second or third property, the cap is lower. For those buyers the maximum LTV stays at 70 percent.

There is a catch that surprises many buyers. The LTV is calculated on the bank’s own valuation, not on the price you agreed with the seller. Banks tend to value property below the open market figure, often by 10 to 20 percent. So if you buy a house at market price and the bank values it lower, your real down payment is bigger than the headline 20 or 30 percent. Plan for that gap early.

Step 1: Check your eligibility before you shop

Do not fall in love with a house before you know what you can carry. Banks look at your income and your existing debts.

The main test is your repayment capacity. Lenders in Nepal generally want your total EMI load to stay under about half of your net monthly income. This is sometimes called the Fixed Obligation to Income Ratio. It usually sits in the 40 to 50 percent range, and it counts all your loans, not just the new one . If you already pay a car loan and a personal loan, that eats into how much house you can afford.

Salaried and self-employed people can both apply. Salaried borrowers usually have an easier time because their income is simple to prove. Self-employed borrowers and business owners can still qualify, but they need to show documented, stable income.

A simple rule helps here. Add up your monthly take-home pay and subtract your current loan payments. Assume the bank will let the new EMI use up to roughly half of your gross income. That gives you a realistic ceiling before you talk to anyone.

Step 2: Get pre-qualified

Before you finalize any property, take your income documents to a bank and ask for pre-qualification. The bank reviews your income and gives you an eligibility figure, sometimes as a letter.

This step is worth the effort. It tells you your real budget. It makes you a more serious buyer in the seller’s eyes. And it saves you from chasing a house the bank will never fully fund. Compare offers from three or four banks at this stage. Rates and processing fees vary more than people expect.

Step 3: Find the property and verify its documents

Now you shop. When you find a house or apartment you like, the paperwork matters as much as the building.

The single most important document is the Lalpurja, the land ownership certificate. Without a clean Lalpurja in the seller’s name, no bank will lend, and you should not buy. Check that the land is free of any Roka (freeze), court dispute, or existing bank claim. You can verify this at the Land Revenue Office (Malpot).

You will also want to see the survey trace map (naksa) and the tax clearance showing land revenue is paid up to date. For a built house, ask for the building permit (naksa pass) from the local government. If you are buying in an apartment complex, ask about the occupancy certificate, maintenance charges, and how ownership share is recorded.

For a deeper walkthrough of this stage, Basobaas has a full guide on how to buy a house in Nepal and a separate breakdown of buying versus building.

Step 4: Property valuation

Once you and the seller agree, the bank sends its own approved valuer (a chartered engineer or valuation firm) to assess the property. You usually pay this fee. It runs roughly NPR 5,000 to NPR 15,000 depending on the property.

The number the valuer produces is the number the bank uses for LTV. This is the moment the market-versus-valuation gap becomes real. If the valuation comes in lower than your purchase price, ask the bank how they reached it, and adjust your down payment plan.

Step 5: Submit the full loan application

With a property chosen and valued, you submit the complete application. Here is a typical document checklist:

• Lalpurja (land ownership certificate), original
• Survey trace map and blueprint
• Tax clearance and Malpot receipt showing dues cleared
• Building permit (naksa pass) if there is construction
• Citizenship certificate of the borrower
• Income proof: salary certificate for salaried buyers, or 3 years of tax returns plus audited accounts for the self-employed
• Bank statements for the last 6 to 12 months
• The bank’s property valuation report

The cleaner this file is, the faster everything moves. A single missing tax receipt can stall the whole process for days.

Step 6: Legal check and sanction

The bank’s legal team verifies the property title and looks for any encumbrance. This usually takes about 5 to 15 days. If the title is clean and your income checks out, the bank issues a sanction letter that states your approved loan amount, the interest rate, the tenure, and the conditions.

Read the sanction letter carefully. This is where you see the real cost of the loan, not the advertised rate.

Step 7: Sign the agreement and register the mortgage

After you accept the sanction, you sign the loan agreement. Then the sale is registered and the mortgage (dhito) is created in the bank’s favor at the Land Revenue Office. In plain terms, the property becomes the collateral. If you stop paying, the bank has a legal claim on it.

Budget for the transaction costs here. Land registration fees in Nepal typically run around 4 to 6 percent of the property value, and if you used a broker, commission is usually 1 to 2 percent. These are on top of your down payment, so keep cash aside.

Step 8: Disbursement and your first EMI

Once the mortgage is registered, the bank disburses the loan. For a ready house, the money usually goes straight to the seller. For a house under construction, it comes in stages tied to building progress.

Then your EMIs begin. The EMI is your fixed monthly payment covering interest and principal. Early on, most of it is interest. Over the years, more of it chips away at the principal.

What will the loan cost? Rates and fees in 2026

As of July 2026 (Shrawan 2083), floating home loan rates in Nepal ran from about 6.49 percent to 8.50 percent per year. Fixed rates with a 5 to 7 year lock-in ran from about 6.99 percent to 8.25 percent. The government banks, Nepal Bank, Rastriya Banijya Bank, and ADBL, sat at the low end near 6.5 percent. Most private banks started around 7.25 to 7.5 percent for strong borrowers.

Your rate is built from two parts: the bank’s base rate plus a premium (spread) for housing loans. When the base rate changes, and it can change quarterly, a floating EMI moves with it. Rates and rules change, so treat these figures as a 2026 snapshot and confirm the current numbers with the bank before you sign.

Other costs to expect:

• Processing fee: a one-time charge of about 0.25 to 0.75 percent of the loan amount.
• Valuation fee: roughly NPR 5,000 to NPR 15,000.
• Prepayment penalty: often 1 to 2 percent if you repay early inside a fixed lock-in. Many banks waive this on floating loans after the first year.

Maximum tenure is commonly 25 years, and a few banks stretch to 30.

Fixed or floating: which should you pick?

A floating rate moves with NRB policy. If rates fall, your EMI falls with them. If rates rise, it climbs. A fixed rate locks your rate for a set period, usually 5 to 7 years, then most banks switch you to floating.

There is no single right answer. Floating suits you if you can absorb some month-to-month change and you expect rates to hold or drop. Fixed suits you if your income is tight or variable and you need a predictable EMI for budgeting. Ask each bank to show you both options in writing before you decide.

A quick worked example

Say you take a loan of NPR 50 lakh at 7.5 percent for 20 years. The EMI works out to roughly NPR 40,280 a month, with total interest of about NPR 46.7 lakh over the full term. Stretch the same loan to 25 years and the monthly payment drops, but you pay more interest overall. Shorten it and the monthly payment rises while total interest falls. Play with the tenure before you commit. Even one extra EMI a year can cut a 20-year loan down by a few years.

What happens if you miss payments?

Life happens, so know the consequences. Miss an EMI and the bank first sends a reminder and a small penalty. If the loan stays unpaid for 90 days, it is classified as a non-performing loan. If it drags on for around six months, the bank can begin auction proceedings on the property under the Debt Recovery Act. Missed payments are also reported to the Credit Information Bureau, which hurts your ability to borrow later.

The practical advice is simple. If you see trouble coming, call the bank before you default. Rescheduling is usually possible when you ask early.

Frequently asked questions

How much down payment do I need to buy a house with a home loan in Nepal?

For a first-time buyer, as little as 20 percent of the bank’s valuation if you qualify for 80 percent LTV, subject to NRB conditions. For repeat buyers it is at least 30 percent. Remember the bank values below market, so your real cash need is usually higher. Keep extra for registration fees and broker commission.

Can a self-employed person get a home loan in Nepal?

Yes. You need to show stable, documented income. Banks typically ask for 3 years of tax returns, audited financial statements, and business registration in place of salary slips.

Can NRNs buy a house in Nepal with a home loan?

NRNs with valid Nepali citizenship can apply. Overseas income and remittance can count toward eligibility, and several banks run specific NRN home loan products. Many NRNs buy through a trusted representative using a power of attorney.

How long does the whole process take?

The bank stage usually takes 15 to 30 days for a clean case. Add time for finding the property and sorting any title issues. A messy Lalpurja or unpaid land tax is the most common cause of delay.

Should I choose the longest tenure to keep my EMI low?

A longer tenure lowers the monthly payment but raises the total interest you pay. Pick the shortest tenure your budget can comfortably handle, and prepay when you can.

Is the advertised interest rate the rate I will actually pay?

Not always. Your rate depends on the bank’s base rate, its housing premium, and your borrower profile. Strong borrowers can often negotiate 0.25 to 0.5 percent off the premium. Always check the sanction letter for the real number.

Before you start

Buying with a home loan is mostly about preparation. Sort your income proof, clear any small debts that drag down your eligibility, and never sign for a property whose Lalpurja you have not verified. Compare a few banks rather than walking into the first one. The cheapest headline rate is not always the cheapest loan once fees and terms are counted.

When you are ready to start looking, you can browse verified houses and apartments on Basobaas, or list your own property if you are selling. Take the paperwork seriously, keep some cash in reserve, and the rest of the process is a series of manageable steps.