New Delhi: Homebuyers are facing difficult times because fears of the pandemic-induced recession kept lenders on edge. In the wake of the coronavirus outbreak, which has led to salary reductions and even job losses, banks have asked flat buyers whose loans were sanctioned earlier to resubmit their fresh salary slips, before new disbursement, in order to prove they are capable of paying their equated monthly instalments (EMIs).
The primary purpose behind this move is that banks like to ascertain that homebuyers can clear their loans in future.
A Mumbai-based builder told TOI that many of his clients have flagged concerns that lenders have stopped disbursing loans for the last two months. “There are cases where the bank had released 20 per cent of the loan of a flat buyer but has now stopped following the lockdown,’’ he mentioned.
Banks say that their guidelines need them to ensure at the time of disbursement whether the borrower is in a position to clear the loan.
The daily quoted an executive in a private bank as saying, “If at the time of disbursement, the borrower finds that his income is not enough to pay the monthly instalment, it would be in his interest to exit the transaction. If he subsequently defaults at an early stage of the loan (before he can take possession), he will have neither a home nor the access to credit to buy a cheaper house.”
Ajay Ashar, Maharashtra Chamber of Housing Industry (Thane) president, told the daily that lenders are reassessing home loans of their clients due to pay cuts, and further disbursements have been kept on hold. Many builders are adversely impacted as banks are delaying payments to them. It is worth noting that several companies have cut salaries due to the drastic decline in revenue.
Ashar further stated that he sold 1,000 under-construction flats, booked by people who have availed home loans. “We were getting regular payments from the banks but this stopped after the lockdown,” he added.
“It is not something new that we are doing. We do look at the latest income statements as part of our normal appraisal process,’’ the publication quoted a spokesperson for HDFC, the largest private home loan lender in the country, as saying.
Meanwhile, State Bank of India (SBI) chairman Rajnish Kumar said the bank had already set stringent loan eligibility guidelines with respect to credit score for sanctioning loans. “Most of our borrowers are salaried and we do not see any stress in the home loan portfolio,” the SBI boss told the daily.