Changing Flat in Same Builder Project: Home Loan Papers

You can usually move to another flat in the same builder project, but your home loan does not move on its own. The bank's sanction, mortgage and disbursement records all name a specific unit, so you need a new or amended agreement for sale, a builder letter transferring your payments, fresh permission to mortgage, a revised sanction or amendment letter, and updated tripartite agreement, valuation and insurance before any further money is released. Status as of October 2026.

Why the bank treats a flat change as a new property

A home loan is secured against one identified property. When you booked flat A, the bank checked that unit's title, approvals, carpet area and value, and its charge (and, for an under-construction flat, the tripartite agreement) refers to flat A. If you shift to flat B, even on another floor of the same tower, the bank has to:

• confirm the new unit is free for sale and covered by the project's RERA registration and approvals
• re-value it and recompute the loan-to-value (LTV) ratio
• move its security interest from flat A to flat B
• make sure every rupee it already paid to the builder is now credited to flat B

Until that is done, most banks will stop further disbursements. Read how sanction and disbursement differ if your loan is only partly disbursed.

The documents that need updating

Ask the bank for its own checklist in writing; banks and housing finance companies differ in what they need and in what order.

Agreement for sale and stamp duty

Under the Real Estate (Regulation and Development) Act, 2016, Section 13 bars a builder from taking more than 10% of the flat cost as advance without first entering into a written, registered agreement for sale. So if you have paid beyond 10%, there is almost certainly a registered agreement for flat A. Changing units means cancelling or amending it and registering one for flat B.

Stamp duty on the old agreement is not automatically carried over. States treat this differently: some allow a refund on a cancelled agreement within a strict window (in Maharashtra, for example, the application window is short and runs from registration of the cancellation deed, and a 2026 amendment bill proposes changes), while others allow little or none. Check with the sub-registrar before you sign the cancellation. If the new flat costs more, stamp duty on the new agreement is calculated on the new value.

The builder's payment transfer letter

This is the most important paper for the bank. It should state, on the builder's letterhead:

1. Old unit number, total paid against it, split into your own contribution and bank disbursements with dates
2. That the full amount is transferred and credited to the new unit
3. Any transfer or change-of-unit fee charged, and that no amount is forfeited
4. That no refund is being paid to you for the old unit

Without it, the bank cannot be sure its money is still protected.

Worked example: moving from a ₹72 lakh flat to an ₹80 lakh flat

Illustrative figures, not an offer from any lender.

• Flat A price: ₹72 lakh. Sanctioned loan: ₹57.6 lakh (80% of the value; for banks, RBI allows up to 80% LTV on loans above ₹30 lakh and up to ₹75 lakh).
• Paid so far: ₹14.4 lakh own contribution + ₹20 lakh disbursed by the bank = ₹34.4 lakh.
• You switch to flat B priced at ₹80 lakh. The builder transfers all ₹34.4 lakh.
• The bank's valuer, however, values flat B at ₹76 lakh (for example, because comparable resale prices are lower than the builder's new price list).

Banks lend on the lower of price and valuation. So the maximum loan on flat B is 80% × ₹76 lakh = ₹60.8 lakh, not 80% × ₹80 lakh = ₹64 lakh.

The price rose by ₹8 lakh but the loan can rise by only ₹3.2 lakh, so you must find ₹4.8 lakh more yourself, plus any extra stamp duty, registration and transfer fee. If the revised loan crossed ₹75 lakh, the bank LTV cap would drop to 75%. The bank also rechecks whether your income supports the higher EMI. Use the EMI calculator to check the EMI on the revised loan amount before you commit to the switch.

Step-by-step: how to switch without stalling your loan

1. Get the builder's offer in writing first. Ask for the new unit's price, carpet area, payment plan, transfer fee and possession date before you cancel anything.
2. Tell your bank before signing. Share the offer and ask whether it will fund the new unit, at what amount, and the list of documents and fees (legal, valuation, amendment charges).
3. Check the new unit independently. Confirm on the state RERA website that the tower or phase is registered and the possession date. Compare it with what is in under-construction vs ready-to-move risks.
4. Sign cancellation and new agreement together. Avoid a gap where the old agreement is cancelled but the new one is not registered.
5. Collect the payment transfer letter, NOC and new demand letter. Submit them with the new agreement to the bank.
6. Sign the revised sanction or amendment letter and new tripartite agreement. Read every changed term, including fees and any rate reset; compare it line by line as explained in sanction letter vs loan agreement.
7. Update insurance and PMAY or tax records if relevant. A property-linked insurance policy needs the new address. If you are claiming benefits that depend on carpet area or property value, recheck eligibility for the new unit.
8. Restart disbursements. Check every new demand letter against the construction stage before releasing funds, as shown in checking a builder demand letter.

Interest while the switch is in progress

Interest runs on the amount already disbursed, not on the flat. In the example above, if the bank's rate is 8.5%, simple pre-EMI interest on ₹20 lakh is about ₹14,167 a month (₹20,00,000 × 8.5% ÷ 12). That continues while paperwork is pending. If the builder caused the delay, ask in writing for a waiver of any delayed-payment interest on the new unit.

If something goes wrong

• Builder refuses to transfer the full amount or forfeits a part: RERA Section 11(5) says the builder can cancel an allotment only in terms of the agreement for sale, and you can approach the state RERA authority if a cancellation is unilateral and without sufficient cause.
• Bank delays or asks for unexplained fees: write to the bank's grievance officer and ask for the fee to be shown in the sanction letter and KFS. If there is no reply in 30 days, banks and NBFCs can be escalated to the RBI at cms.rbi.org.in (helpline 14448). For a housing finance company, escalate to the National Housing Bank's GRIDS portal at grids.nhbonline.org.in.
• Never pay "processing" money to an agent's personal account or share OTPs for the switch. Pay builders and banks only through their official accounts.

Key takeaways

• Changing flats in the same project means a new property for the bank: fresh legal check, valuation and charge.
• Get a builder letter transferring every rupee paid, including bank disbursements, to the new unit.
• The bank lends on the lower of price and its valuation, within RBI LTV caps (90%, 80%, 75% by loan size for banks), so a costlier flat can need more of your own money.
• Stamp duty on the old agreement may not carry over; check your state's refund window before cancelling.
• Keep paying pre-EMI or EMI during the switch; interest runs on what is already disbursed.