What Is OCR in Home Loan? (Own Contribution Receipt) Meaning, Amount & Process Explained
When applying for a home loan, banks often ask for OCR before disbursing the loan amount. Many first-time homebuyers get confused about what OCR means and why it is required.
In home loan terminology, OCR does NOT mean any registrar or office.
Instead: 👉 OCR stands for Own Contribution Receipt
This detailed guide explains what is OCR in home loan, its meaning, how much OCR is required, documents needed, and why banks consider it mandatory.
What Is OCR in Home Loan?
OCR (Own Contribution Receipt) is the proof that the borrower has paid their own share of the property cost before the bank releases the home loan amount.
In simple words, OCR shows that:
- You have invested your own money in buying the property
- You are not fully dependent on the bank loan
Banks require OCR as evidence of down payment.
Example to Understand OCR Easily
Let’s say:
- Property price: ₹50 lakh
- Bank loan approved: 80% (₹40 lakh)
- Your own contribution: 20% (₹10 lakh)
👉 The receipt showing payment of ₹10 lakh to the builder or seller is called OCR (Own Contribution Receipt).
Without this receipt, the bank will not disburse the loan.
Why OCR Is Required in Home Loan
Banks and NBFCs ask for OCR to:
- Ensure borrower has financial commitment
- Reduce lender risk
- Follow RBI Loan-to-Value (LTV) rules
- Prevent 100% loan funding
- Confirm genuine property purchase
👉 No OCR = No loan disbursement
How Much OCR Is Required?
OCR amount depends on the loan-to-value ratio (LTV) set by RBI.
OCR Requirement Based on Property Value
| Property Value | Max Loan | Minimum OCR |
| Up to ₹30 lakh | Up to 90% | 10% |
| ₹30–75 lakh | Up to 80–85% | 15–20% |
| Above ₹75 lakh | Up to 75–80% | 20–25% |
📌 Higher property value = higher own contribution required.
OCR vs Down Payment vs Margin Money
These terms are often used interchangeably.
| Term | Meaning |
| OCR | Proof of own contribution |
| Down Payment | Amount paid by borrower upfront |
| Margin Money | Borrower’s share of property cost |
👉 OCR is the receipt for down payment / margin money.
When Is OCR Required in Home Loan Process?
OCR is required before loan disbursement.
Home Loan Flow with OCR
- Home loan sanctioned
- Property documents verified
- Borrower pays own contribution
- OCR submitted to bank
- Bank disburses loan amount
Banks usually ask for OCR after sanction but before disbursement.
OCR for Under-Construction Property
For under-construction projects:
- OCR is paid to the builder
- Receipt must include:
- Builder name
- Project name
- Flat number
- Payment amount
Banks verify OCR before releasing each construction-linked installment.
Documents Required for OCR
To submit OCR, banks generally ask for:
- Payment receipt from builder/seller
- Bank statement showing debit entry
- Cheque / NEFT / RTGS proof
- Agreement to sell / allotment letter
⚠ Cash payments are usually not accepted.
Who Issues OCR?
- Builder (for new or under-construction property)
- Seller (for resale property)
The receipt must be:
- Signed
- Stamped (if applicable)
- Mention buyer & property details
Is OCR Required for Loan Against Property (LAP)?
❌ No.
OCR is mainly required for home loans.
For Loan Against Property, the loan is based on existing property value, not purchase price.
Common Mistakes Borrowers Make with OCR
- Paying OCR in cash
- Submitting handwritten receipts
- Mismatch in receipt and bank statement
- OCR amount less than required
- Delayed OCR submission
Any of these can delay loan disbursement.
Tips to Get OCR Accepted Easily
- Always pay via bank transfer or cheque
- Ensure receipt matches bank statement
- Pay OCR before asking for disbursement
- Keep multiple copies of receipt
- Confirm OCR amount with bank first
Final Thoughts
OCR in home loan is one of the most important yet misunderstood requirements. It is not a fee or tax, but proof of your own financial contribution towards the property.
Before applying for a home loan:
- Know your required OCR amount
- Pay it through banking channels
- Submit proper receipt to the bank
A clear understanding of OCR ensures smooth and faster home loan disbursement.
Explore more at Bhulekh India.
FAQs
OCR means Own Contribution Receipt, proof of borrower’s own payment.
Yes, OCR is mandatory before loan disbursement.
No, OCR is your own investment, not a bank charge.
No, banks do not disburse loans without OCR.
Indirectly yes. Higher OCR lowers bank risk and may help in negotiation.
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