02-04-07
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Beware: Home loan frauds on the rise
Hello Friends,
Home loans have now become an integral part of home-buying. I just came along this piece of news on 'Home loan Frauds'. So thought of posting it in the forum. I dont think there can be better place than this to spread awareness. 
Quote:
Calcutta, March 30: Frauds in housing loans have increased over the past few years leading to a rise in non-performing home-loan assets of banks, said P.K. Gupta, chairman and managing director of United Bank of India.
Gupta was speaking at a seminar on Emerging Financial Sector Reforms – Banking and Insurance organised by Bharat Chamber of Commerce here today. “Banks are increasingly facing difficulties with bad titles of properties against which they had lent money,” he added. The problem has snowballed because there is no good system of keeping records of property titles in the country, he added.
Home loans have increased at a compounded annual growth rate of over 30 per cent during the last five years and the industry average non-performing assets of housing finance institutions have soared to 4 per cent from around 2 per cent in 2001.
Mortgage loans as a percentage of gross domestic product is quite low for India (at 4 per cent) compared with other South Asian countries such as Thailand (9 per cent), Malaysia (13 per cent), Taiwan (17 per cent) and Korea (37 per cent). However, the increasing incidence of non-performing assets in the rapidly growing housing loan sector, coupled with skyrocketing prices in real estate, has forced the Reserve Bank to tighten its noose.
Home loans became costlier by 2.5 percentage points within a span of one year.
- The Telegraph, Kolkata
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Last edited by Tanuj; 02-04-07 at 11:12 AM.
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