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Need Help !

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Need Help !

Last updated: July 16 2009
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  • Need Help !

    Here is the situation I am in -

    - Had booked a flat on 26/6 by giving the builder a posted dated cheque dated 13/July (project is almost 75% complete)
    - Builder calls me on 13th to ask if he can deposit the cheque and suggest that we should sign the agreement asap. The reason being I cannot apply for loan until the agreement is signed and he is in need of funds.
    - Unfortunately, I am traveling out of India coming Friday( for just 15 days), don't feel comfortable proceeding the agreement before I get it checked thoroughly. Also, I need more time for shopping around for different loan products (after all its a life time decision .. this means that we sign the agreement after i come back in aug.
    - He is not ready since it delays his funds, he has another customer who is willing to buy the flat and is ready to give me a refund for all the amount I have paid.
    - Another point - if I sign the agreement this week and do not take the loan disbursement by July 31st, he can charge me interest on the due amount at the rate of 24% per annum - another reason why I dont want to sign the agreement before I come back.

    I have decided to cancel the deal because I dont trust the builder now. He seems to be only greedy and is not abiding by his commitment. Even after paying the booking amount, if he cannot wait for 10 more days means that he is more interested in selling it to another buyer who is willing to pay more. Did I do the correct thing ?
    Last edited by CoolDude; July 16 2009, 05:46 PM. Reason: updates
  • #2

    #2

    Re : Need Help !

    If you are losing both ways, then why worry. Cancelling is the right thing to do. Anyway no one would recommend investing in an underconstruction project in the current times.

    Comment

    • #3

      #3

      Re : Need Help !

      You did right thing in my opinion.. for that matter even if you are in India it can take some time to arrange funds or to do some due diligence...forget abt that... you will get some better house.. who is the builder by the way...?

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      • #4

        #4

        Re : Need Help !

        Originally posted by worthit View Post
        You did right thing in my opinion.. for that matter even if you are in India it can take some time to arrange funds or to do some due diligence...forget abt that... you will get some better house.. who is the builder by the way...?
        you guys made me feel good .. the builder is Nirman Developers

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        • #5

          #5

          Re : Need Help !

          No offence, but ..

          Originally posted by CoolDude View Post
          Here is the situation I am in -

          - Had booked a flat on 26/6 by giving the builder a posted dated cheque dated 13/July (project is almost 75% complete)
          - Builder calls me on 13th to ask if he can deposit the cheque and suggest that we should sign the agreement asap. The reason being I cannot apply for loan until the agreement is signed and he is in need of funds.
          - Unfortunately, I am traveling out of India coming Friday( for just 15 days), don't feel comfortable proceeding the agreement before I get it checked thoroughly. Also, I need more time for shopping around for different loan products (after all its a life time decision .. this means that we sign the agreement after i come back in aug.
          - He is not ready since it delays his funds, he has another customer who is willing to buy the flat and is ready to give me a refund for all the amount I have paid.
          - Another point - if I sign the agreement this week and do not take the loan disbursement by July 31st, he can charge me interest on the due amount at the rate of 24% per annum - another reason why I dont want to sign the agreement before I come back.

          I have decided to cancel the deal because I dont trust the builder now. He seems to be only greedy and is not abiding by his commitment. Even after paying the booking amount, if he cannot wait for 10 more days means that he is more interested in selling it to another buyer who is willing to pay more. Did I do the correct thing ?

          I do not know if you have got an answer to your specific question!

          Your question has 2 parts:

          1. Did the builder do the right thing by not trusting you even for a 10 day delay as you say.

          2. Did you do the right thing by cancelling the deal (based on, among other things, your mistrust of the builder)

          In today's world, almost every customer is looking for an excuse to bail out without a loss. Lok at it from the builder's perspective. You are one more guy who walks in the door and asks for a delay in payment. What should he think?

          Among other things, he will be thinking ... Are you going out of a job? ... Are you going away to USA and will not return for 10 years and if so what happens to the flat payments?

          Forget today's bad times. Even in mid 1990s I know of a bank which merrily went on lending money to all the IT guys in the company I worked. To compound problems, they took surety from others in the same company. Subsequently, they found a large number of defaults. Most of the guys had left for the USA. When they went to catch the guarantor, he too had flown the coop!

          So, he builder was right in not agreeing to your request simply because there is absolutely no trust amongst anyone in the market anymore!

          Coming to the second question. Did you do the right thing getting out of the deal? Honestly, I think you used this opportunity to force a distrust of the builder (unless you have specific other reasons the builder needed to be distrusted) and went ahead with the cancellation because you had almost made up your mind about it anyway (your new, changed belief about where the market is headed and your confidence about carrying this through).

          While you may have made a good decision (only time will tell), this event only formed a convenient opportunity to tip the decision towards cancellation. So, it became your tipping point! :p

          Do you think so?

          If on the other hand, you were keen to carry on with the deal, you would have found a workaround by giving builder multiple post-dated cheques and worked out other strategies so that he would take your word for it and given an extension. We put in all our efforts in the direction we want things to go!

          Finally, now that you have decided and gone ahead, look ahead and plan for a good next deal as, surely, a good deal will be coming your way sometime in the future!

          No offence. I was trying to be as objective as possible.

          cheers
          Last edited by wiseman; July 16 2009, 07:22 PM.

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          • #6

            #6

            Re : Need Help !

            Thanks for such a detailed reply and bringing another perspective on the table!

            Originally posted by wiseman View Post
            In today's world, almost every customer is looking for an excuse to bail out without a loss. Lok at it from the builder's perspective. You are one more guy who walks in the door and asks for a delay in payment. What should he think?
            Among other things, he will be thinking ... Are you going out of a job? ... Are you going away to USA and will not return for 10 years and if so what happens to the flat payments?
            I do not think he was at any risk because I hadn't signed the agreement so legally I was still not the owner of the house. Moreover he has a significant amount from my side deposited in his account. So assuming the worst case scenario that I decided to walk out of the door while I was out of India, my money was still with him, right ?

            Originally posted by wiseman View Post
            Coming to the second question. Did you do the right thing getting out of the deal? Honestly, I think you used this opportunity to force a distrust of the builder (unless you have specific other reasons the builder needed to be distrusted) and went ahead with the cancellation because you had almost made up your mind about it anyway (your new, changed belief about where the market is headed and your confidence about carrying this through).
            I am no where saying that the I distrusted the builder. I am only saying that he was greedy. I asked him 10 days extra and he bluntly told me that he had another customer (and this is after I payed a significant sum to him as booking amount - almost 15% of the total deal. It looked as if he was trying to get me out of the deal by all ways he can for the simple reason that he had a cusotmer ready to pay a higher price.

            Originally posted by wiseman View Post
            While you may have made a good decision (only time will tell), this event only formed a convenient opportunity to tip the decision towards cancellation. So, it became your tipping point! :p
            I don't agree with this too because if I wanted to walk out of the deal, I would have asked him for refund since I hadn't signed an agreement. Instead I asked him to wait for the agreement for another 15 days, which was 1st week of August. On the contrary, I conveyed to him that I like the flat and would go ahead with the agreement but his only reply was that he has a customer willing to pay a higher price and ready to sign the agreement ASAP.

            Originally posted by wiseman View Post
            If on the other hand, you were keen to carry on with the deal, you would have found a workaround by giving builder multiple post-dated cheques and worked out other strategies so that he would take your word for it and given an extension. We put in all our efforts in the direction we want things to go!
            I did try my best. But unfortunately all he needed was funds. In fact when I think about it, all he was seeing was a waiting customer for the same flat willing to pay a higher psf rate.


            Originally posted by wiseman View Post
            Finally, now that you have decided and gone ahead, look ahead and plan for a good next deal as, surely, a good deal will be coming your way sometime in the future!
            Perfect, I am on the same page with you. I really appreciate your good wishes.

            Comment

            • #7

              #7

              Re : Need Help !

              Just trying out some philosophy

              Originally posted by CoolDude View Post
              Thanks for such a detailed reply and bringing another perspective on the table!


              Perfect, I am on the same page with you. I really appreciate your good wishes.

              CoolDude,

              I might have been completely wrong in each and every one of the postulates.

              I was probably trying to showcase how, in any circumstance, one must take time to see every single stakeholders point of view so that the decision coming out will be the most optimal for all the players.

              Its not so much the correctness of the decision as the correctness of the approach.

              A good stroke by itself does not imply correct technique. But a correct technique is what generally results in a good stroke. And a habit of following correct technique as a rule is what creates a Sachin Tendulkar. Everytime he deviated from the technique, he fell to a bad shot

              On any single decision, Win or lose, its the correctness of the technique that is important. Eventually, we will win.

              cheers

              Comment

              • #8

                #8

                Re : Need Help !

                Pondering over options before arriving at a decision.
                Gud technique to use either boom/bust.

                Right said man.

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