If you are planning to buy or build a home in Nepal in 2026, one number matters more than almost anything else in your budget: the loan-to-value (LTV) ratio Nepal Rastra Bank allows your bank to lend against the property. Since the monetary policy overhaul of mid-2025, first-time home buyers can borrow up to 80 percent of a property's value, while repeat buyers are capped at 70 percent. Nepal Rastra Bank's newest monetary policy for FY 2083/84, unveiled on 8 July 2026, kept this housing framework unchanged, so these are the rules that apply right now.
This guide breaks down exactly what changed, who counts as a first-time buyer, how the loan ceiling interacts with the LTV percentage, and what it means for your actual down payment. It also includes a free calculator so you can work out your numbers before you walk into a branch.
Quick Answer
As of 2026, Nepal Rastra Bank allows banks and financial institutions to lend up to 80% of a property's value to first-time home buyers, and up to 70% to everyone else, for the purchase or construction of a private residential home. The overall loan ceiling for this category is NPR 30 million (Rs 3 crore). Your actual loan is whichever is lower: the LTV-based amount, or the NPR 30 million cap.
What Nepal Rastra Bank Actually Changed
Before July 2025, home buyers in Nepal faced tighter borrowing limits: a maximum loan of NPR 20 million (Rs 2 crore) for a private residential home, with LTV capped at 70 percent for first-time buyers and just 50 percent for everyone else. In its monetary policy for FY 2082/83, announced on 11 July 2025 by Governor Dr. Biswo Nath Poudel, Nepal Rastra Bank raised both the ceiling and the LTV bands to revive a sluggish real estate and construction sector. The revised limits took effect through a circular issued that same month.
NRB's monetary policy for FY 2083/84, released on 8 July 2026, kept core lending rates and the interest rate corridor unchanged and did not roll back the housing provisions. In other words, the higher limits are not a temporary stimulus measure that expired; they remain the operating rule for banks and finance companies through the current fiscal year.
| Provision | Before FY 2082/83 | FY 2082/83 onward (current, 2026) |
|---|---|---|
| Loan ceiling for private residential home | NPR 20 million | NPR 30 million |
| Max LTV, first-time buyer | 70% | 80% |
| Max LTV, other/repeat buyer | 50% | 70% |
| Minimum own contribution, first-time buyer | 30% of value | 20% of value (up to the ceiling) |
How the 80% LTV and Rs 3 Crore Ceiling Work Together
These two rules are not independent; your maximum loan is whichever figure is smaller. For a modestly priced property, the 80 percent LTV usually decides your loan amount. Once a property crosses roughly NPR 37.5 million in value, the NPR 30 million ceiling becomes the binding constraint instead, and your effective LTV starts falling below 80 percent.
| Property value | 80% of value | Actual max loan | Down payment needed |
|---|---|---|---|
| Rs 15,000,000 | Rs 12,000,000 | Rs 12,000,000 | Rs 3,000,000 (20%) |
| Rs 25,000,000 | Rs 20,000,000 | Rs 20,000,000 | Rs 5,000,000 (20%) |
| Rs 37,500,000 | Rs 30,000,000 | Rs 30,000,000 | Rs 7,500,000 (20%) |
| Rs 50,000,000 | Rs 40,000,000 | Rs 30,000,000 (capped) | Rs 20,000,000 (40%) |
That last row is the detail most buyers of higher-value homes miss: past roughly Rs 3.75 crore, the loan amount stops growing even though the property value keeps rising, so your effective down payment percentage climbs well above 20 percent.
Bank valuation is not market price
Banks typically appraise a property at 10 to 20 percent below its market or registration price, especially for land. Your 80 percent LTV applies to the bank's valuation, not the price you agreed with the seller. This gap is real extra cash you need beyond the "20 percent down payment" figure most people quote. Ask your bank for an indicative valuation before you finalise a purchase agreement.
Who Qualifies as a "First-Time" Home Buyer
NRB's higher 80% LTV band is reserved for genuine first-time buyers, and banks verify this before approving a loan at that rate. In general practice across commercial banks, you are treated as a first-time buyer for this scheme if:
- Neither you nor your spouse currently owns a registered residential house or apartment anywhere in Nepal.
- You are borrowing to purchase or construct your own private residence, not a rental investment or a second property.
- You can support the declaration with land revenue office (Malpot) records and a self-declaration, which the bank cross-checks during due diligence.
If you already own residential property, even one you inherited and do not live in, most banks will apply the standard 70% LTV band instead. Requirements can vary slightly by bank, so confirm the exact documentation with your relationship manager before applying. We cover this qualification process in more depth in our guide to qualifying for the 80% LTV first-time buyer loan.
Step by Step: How the Higher LTV Changes Your Application
- Get a realistic bank valuation first. Ask your shortlisted bank for an informal valuation estimate before signing any purchase agreement, since your loan is based on this figure, not the seller's asking price.
- Calculate your effective down payment. Use the 80/70 percent split and the Rs 3 crore ceiling together, not in isolation, especially for higher-value properties.
- Prepare first-time buyer proof. Land ownership certificates for yourself and your spouse, citizenship documents, and a signed declaration of no prior residential ownership.
- Check income eligibility. Banks apply a debt-servicing or installment-to-income ratio, commonly in the 50 to 60 percent range of net monthly income, on top of the LTV rule.
- Compare floating vs fixed pricing. Home loan rates in 2026 range roughly from 6.49% to 8.50% for floating products, so the rate you are offered materially changes your EMI even at the same LTV.
80% LTV Home Loan Eligibility Calculator
Estimate your maximum loan, down payment, and indicative EMI under NRB's current rules. This is an educational estimate only, not a loan offer.
Calculation applies NRB's Rs 30 million loan ceiling and the LTV band you selected. EMI uses the standard reducing-balance formula on the estimated loan and rate. Actual bank valuation, processing fees, insurance, and approved amount may differ. Verify final figures with your bank.
Home Loan Interest Rates in 2026: What This LTV Change Means for Your EMI
A higher LTV lowers your down payment, but it also means a larger loan balance, so the interest rate you are offered matters just as much as the LTV band. As of Shrawan 2083 (July 2026), floating home loan rates across commercial banks broadly range from about 6.49% to 8.50% per annum, tracking each bank's base rate plus a premium, while fixed-rate products with a 5 to 7 year lock-in run somewhat higher. We compare rates bank by bank, and explain when a fixed rate is worth the premium, in our companion guides on bank-wise home loan interest rates in 2026 and floating vs fixed home loan rates.
Common Mistakes and Misconceptions
| Misconception | Reality |
|---|---|
| "I automatically get 80% LTV on any home loan now." | No Only verified first-time buyers get 80%; others remain at 70%. |
| "The loan ceiling was removed along with the LTV increase." | No The ceiling was raised to Rs 30 million, not eliminated. |
| "80% of the purchase price is what I will get." | No LTV applies to the bank's valuation, which is usually lower than market price. |
| "These are permanent legal limits, unlikely to change." | No They are set through NRB's annual monetary policy and can be revised again. |
| "This rule applies the same way at every bank." | Mostly yes The LTV ceiling is uniform, but documentation and income criteria vary by bank. |
Expert tip: apply the calculator before you shop for homes
Run your numbers through the calculator above before you start viewing properties, not after you have made an offer. Knowing your realistic maximum loan and down payment in advance keeps you from falling for a property that looks affordable on the LTV percentage but is not, once the Rs 30 million ceiling or bank valuation gap kicks in.
Frequently Asked Questions
What is NRB's current LTV ratio for first-time home buyers in 2026?
Up to 80% of the bank's appraised property value, subject to an overall loan ceiling of NPR 30 million. This has been in effect since Nepal Rastra Bank's monetary policy for FY 2082/83 (July 2025) and was retained in the FY 2083/84 monetary policy announced in July 2026.
Does the Rs 30 million limit include the cost of the land?
Yes. The ceiling applies to the total loan for purchasing or constructing the private residential home, which typically covers land and building together when both are financed under the same facility. Confirm the exact treatment with your bank, since construction-linked disbursement schedules can vary.
Who counts as a "first-time" home buyer under these rules?
In general practice, someone who, together with their spouse, does not already own a registered residential house or apartment anywhere in Nepal, and is borrowing to buy or build their own primary residence rather than an investment property. Banks verify this through land revenue records and a signed declaration.
Can I add a co-borrower to increase my eligible loan amount?
Adding a co-borrower, such as a spouse, can improve your income-based eligibility and debt-servicing ratio, which affects how much of the LTV-based maximum you can actually service. It does not change the 80%/70% LTV band itself, which is set by buyer category, not by the number of applicants.
If my property costs more than Rs 30 million, can I still get 80% LTV?
You can request 80% LTV, but the loan amount will be capped at Rs 30 million rather than 80% of the full value. On a Rs 5 crore property, for example, Rs 3 crore is the maximum loan, so your effective LTV drops to 60%, not 80%.
Does the 80% LTV apply to apartments and flats, or only individual houses?
The provision generally covers private residential homes, which includes apartments and flats purchased for personal residence, as well as land-plus-construction loans. Apartment purchases also fall under the Apartment Ownership Act framework for ownership and registration, which is a separate legal layer from the LTV rule itself.
Do these LTV rules apply equally to all banks and finance companies?
The LTV ceilings are set by Nepal Rastra Bank and apply across commercial banks and other regulated financial institutions. However, individual banks can be more conservative than the ceiling, and their income, credit history, and documentation requirements can differ, so eligibility still varies by lender.
Will NRB change these home loan rules again before the next fiscal year?
NRB reviews lending provisions as part of its annual monetary policy, typically announced in mid-July, and can adjust them mid-year through separate circulars if economic conditions require it. Treat the current 80%/70% LTV bands and Rs 30 million ceiling as the applicable rule for now, and confirm with your bank or NRB's official notices before finalising a large purchase.
Conclusion
NRB's 2026 home loan framework meaningfully lowers the entry barrier for genuine first-time buyers: an 80% LTV against a Rs 30 million ceiling means a smaller down payment than at any point in recent years, provided your target property is priced sensibly against that ceiling. The two numbers that decide your real budget are the LTV percentage for your buyer category and the Rs 30 million cap, applied together, not the advertised loan value alone. Run your own numbers through the calculator above, confirm your first-time buyer status with your bank early, and compare interest rates before you commit, since the rate spread across banks in 2026 is wide enough to change your EMI by a meaningful margin over a 20-year term.
Related reading: How to qualify for NRB's 80% LTV loan as a first-time buyer | Home loan interest rates in Nepal 2026, bank-wise comparison | Apartment Ownership Act 2054: what every buyer must know
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