I have ₹16 lakh in savings. Is it possible to buy a ₹2 cr house?

I am 38 years old and have savings of nearly ₹16 lakh. I want to purchase a 2BHK flat in Mumbai for ₹2 crore. How can I achieve this goal? I want to finance this house with a bank loan and I am planning to use 60% of my savings.

-Siddhesh Jamsandekar

It is rather challenging for you to buy a ₹2 crore home, with the relatively smaller asset pool of ₹16 lakh that you currently have. Most loan providers are likely to insist on at least a 10% down payment, which itself comes to close to ₹20 lakh, and this is higher than the assets that you currently have.

If you were to take a loan of ₹1.8 crore, ie the balance amount for 20 years, your equated monthly instalment (EMI) would come to approximately ₹1.56 lakh at current interest rates. If this EMI, along with any other EMIs that you currently have, is not more than 50% of your net salary, you can evaluate going with it, provided your income sources are stable. Alternatively, you may need to consider buying a house of a significantly lower value than ₹2 crore.

I have worked in two IT companies before and have a provident fund (PF) account. However, my Aadhar was not linked to the UAN, or universal account number provided by the Employees’ Provident Fund Organisation (EPFO), at that time.

I took a break from employment and recently joined a new IT firm where they issued me with a new PF account and a new UAN. However, when I asked my current employers to transfer funds from my existing PF account to the new one, they said this has to be done by the previous employer. The latter is also not helping.

I then approached EPFO officials, who said this needs to be done by the employers concerned. Is there a way to transfer or withdraw money from the existing PF account?

—Srikanth

In order to correct this, you will need to inform your current employer or the EPFO: you will have to email the current and previous UAN to uanepf@epfindia.gov.in.

Post a verification process, your previous UAN will be blocked and the new one will be kept alive. You will then have to submit a claim to transfer the EPF account (linked with the blocked UAN) to the new active account. This may take some time though, so you would need to be patient with the process.

Vishal Dhawan is a certified financial planner and founder of Plan Ahead Wealth Advisors, a Sebi registered investment advisory firm.