Where there is a house, there is a way!
The New Central Government is proposing to support for the construction of houses for the middle class and poor people. The estimate is about 7 Crore houses. The mission for the government is low cost affordable housing. This is real good new news for developers. Out of this 7 crore, 31% of the houses are in urban areas and the balance in rural areas. The Government is planning to allocate Rs. 4000 Crore to National Housing Board (NHB). This NHB is an autonomous body and branch of Reserve Bank of India. NHB will define policy from time to time to all Housing Financing Companies including Nationalized Banks. Housing Finance Companies can function as per the policies derived by NHB only. Otherwise there will be no reorganization given for these housing finance companies.
Know Your Customer
Before giving loans to customers, housing finance companies should ensure the following:
- Customer is capable of repaying the loans.
- Customer is having proper address proof, Photo ID cards.
- Land should have proper approval from the government, which is either approval by Panchayat, or City authority.
- Patta should be available.
- Construction plan should be as per the norms.
- Complete link documents should be available.
- Land should have proper clearance from both Advocate and Engineer.
Records are necessary
Housing finance companies should check proper records of all the above and collect the originals from the customer towards security purpose. Periodically they submit the scan copies of the collected documents to NHB and can claim subsidy in the interest allocated. NHB in turn verify all the scanned copies and pass the claim for reimbursement. Government is very keen that the low cost budgeted houses should go to the right person who will truly self occupy the house.
Nationalized Banks like SBI and others also will participate in this scheme and extend proper loans to the right customers. Though the procedure of documentation is common for housing finance companies as well as Nationalized Banks, the rate of interest for lending may differ from one institution to another depending upon their internal norms. It is customers’ choice to select the institution for getting loans.
Article Source: Indian Express
