CHEQUE BOOK

HT Estates - - Front Page - Harsh Roongta

I have booked a 1BHK flat in a pro­ject in Noida, Sec­tor 75, and had ap­plied for a home loan from HDFC Ltd. At the time of ap­ply­ing for the loan, the salesperson told me that an­other pro­ject of 2BHK flats by the same builder was al­ready ap­proved by HDFC and the 1BHK pro­ject was also in the pipe­line for ap­proval. There­fore, I sub­mit­ted all my ap­pli­ca­tions for loan spec­i­fy­ing the pur­chased flat de­tails in the form. Af­ter two months my ap­pli­ca­tion for the loan amount has been ap­proved, but the bank has still not ap­proved the 1BHK pro­ject. Ac­cord­ing to the builder they have sub­mit­ted all the nec­es­sary pa­pers to the bank. The bank is not as­sur­ing me of any date till when the pro­ject will get ap­proved nor giv­ing me any in­for­ma­tion re­gard­ing dis­ap­proval of the pro­ject. I will have to pay the next in­stall­ment for my flat soon, for which I was de­pend­ing on the bank loan. It will take an­other two months to ap­ply to an­other bank. My query is what should I do now? Should I wait or should I ap­ply to an­other bank? How can I get back my pro­cess­ing fees from HDFC Ltd?

— Su­nil Mot­wani You should never buy in an un­der-con­struc­tion pro­ject un­less it has been pre-ap­proved by at least a cou­ple of large lenders. Even then, do please re­mem­ber that pre-ap­proval does not mean that the risk of de­lay is not on your head.

It is al­ways bet­ter to buy a ready-to-move-in flat even though it is more ex­pen­sive be­cause that you avoid all con­struc­tion de­lay risks and saves on ser­vice tax and VAT that is payable only on un­der-con­struc­tion flats.

I would ad­vise you to ap­proach an­other lender with­out any de­lay for the loan, as it is not cer­tain within what time frame the lender will ap­prove the pro­ject. Check with the de­vel­oper in case any lender has pre-ap­proved the pro­ject and you can ap­proach that lender. Most lenders do not re­fund pro­cess­ing fees in case the loan sanc­tion is not used. You can make an at­tempt to get the re­fund of pro­cess­ing fees but it may not re­ally work. I am plan­ning to buy a prop­erty, which is ex­pected to go un­der re­de­vel­op­ment in Gore­gaon, Mum­bai. I will be grate­ful if you can tell me whether the sit­u­a­tion (with re­gard to home loans) still re­mains the same or if banks are more will­ing to give no-ob­jec­tion cer­tifi­cates and may not ask for ad­di­tional se­cu­rity dur­ing the pe­riod un­der which the prop­erty is un­der re­con­struc­tion.

— Ajay Kumar It is usu­ally dif­fi­cult to get an NOC from the ex­ist­ing lender if the prop­erty is go­ing in for re­de­vel­op­ment. There are chances that the lender may ask the bor­rower to re­pay the en­tire loan amount in one go be­fore it goes for re­de­vel­op­ment. The lenders are re­luc­tant to give NOC be­cause re­de­vel­op­ment is a long process with fre­quent reg­u­la­tory changes, high prob­a­bil­ity of lit­i­ga­tion and de­lay in con­struc­tion. This all may lead to the bor­rower de­fault­ing on the loan re­pay­ment.

Hence, in such a sit­u­a­tion the best op­tion may be to ap­proach the lender fund­ing the de­vel­oper of the re­de­vel­op­ment pro­ject for the bal­ance trans­fer from your ex­ist­ing lender.

You can also use the cor­pus amount re­ceived, if any, from the re­de­vel­oper to pay-off the loan amount.

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