Announcement

Collapse
No announcement yet.

Home loans

Collapse
X
Collapse

Home loans

Last updated: November 22 2010
8 | Posts
3223 | Views
  • Time
  • Show
Clear All
new posts

  • Home loans

    I have an approved home loan from LICHFL to purchase 3BHK flats in Omaxe New Heights. The disbursement of the loan has not been started yet. Does anyone have the idea, when the same is going to be started?
  • #2

    #2

    Re : Home loans

    Home Loan Growth Expected this Festive Season

    Notwithstanding rising interest rates, mortgage lenders continue to remain optimistic of strong loan growth in the festive season ahead. Banker and analysts said lower real estate prices , coupled with special interest rate schemes and higher salary payouts, are working in favour of strong home loan growth.
    “We are expecting a 22-25 % growth for this year,” said Renu Sud Karnad, managing director of HDFC. Bank of Baroda is also expecting a similar growth rate for its home loan, its chairman and managing director M D Mallya added. Last year, during the same period, BoB’s home loan portfolio had grown by around 21%. A host of banks, including State Bank of India, Punjab National Bank and Corporation Bank, among others, are offering home loans at special rates till December 31.
    SBI has extended its special loan scheme wherein loans are disbursed at 8% for the first year and 9% for the second and third year. “The second half of the year is going to be the major booster in terms of home loan growth,” said Mohan Tanksale, executive director of PNB. His bank is targeting to disburse Rs 2,000 crore in the second half of FY11. The bank had sanctioned Rs 1,000 crore of home loans in the year-ago period.
    “Real estate prices have stabilized. The income of people have also become more stable in the last few months,” said R R Nair, director and CEO of LIC Housing Finance. Sundaram Home Finance, the home loan finance arm of Sundaram BNP Paribas, is also upbeat. It has distributed Rs 540 crore in home loans in the first two quarters and is confident of recording similar growth in the festive season . “While the Rs 20-lakh plus segment is seeing an uptick , the big driver for us, in tier II towns, are sub-Rs 20-lakh loans,” said Srinivas Acharya, MD, Sundram BNP Paribas Home Finance.
    Download our Android App! | Please Read IREF Rules | FAQ's

    Comment

    • #3

      #3

      Re : Home loans

      Understand how banks and HFC's work. They give you sanction letter of your home loan based on your individual credit worthiness. However they will disburse loan to the builder only after they verify that the project is clear an has all the relevant permissions/approvals.

      If any of the approvals are remaining no bank will disburse the loan. So by this funda go to Omaxe and ask their sales staff if any approval is still remaining? They will give you exact picture. or go to LIC, even they can share this.

      Originally posted by debpriya1984 View Post
      I have an approved home loan from LICHFL to purchase 3BHK flats in Omaxe New Heights. The disbursement of the loan has not been started yet. Does anyone have the idea, when the same is going to be started?

      Comment

      • #4

        #4

        Re : Home loans

        Originally posted by vipul.jindal View Post
        Understand how banks and HFC's work. They give you sanction letter of your home loan based on your individual credit worthiness. However they will disburse loan to the builder only after they verify that the project is clear an has all the relevant permissions/approvals.

        If any of the approvals are remaining no bank will disburse the loan. So by this funda go to Omaxe and ask their sales staff if any approval is still remaining? They will give you exact picture. or go to LIC, even they can share this.

        Truely said vipul....

        debpriya1984 u must visit the LICHFL office or u can also ask the representative from whom u deal for loan

        Comment

        • #5

          #5

          Re : Home loans

          RBI tightens screws on home loans; realty stocks plunge

          Concerned that excessive lending for home loans and rising realty prices may create a financial crisis, RBI today directed banks to keep more funds aside as a cushion for advances of Rs 75 lakh and above, sending realty stocks into a tailspin. Realty companies said, however, that supply of houses has to improve to correct the situation and bankers indicated that home loan rates may not go up immediately.

          In its quarterly monetary review, the RBI also asked banks to set aside higher amount for the controversial teaser home loans rates as a cushion in case of defaults. Teaser home loans are given at low interest rates for initial years.

          The central bank upped risk weight on housing loans of Rs 75 lakh and above to 125 per cent. Thus, banks will now have to keep more money aside for giving housing loans.

          The current weight ranges from 50-100 per cent. "It is proposed to increase the risk weight for residential housing loans of Rs 75 lakh and above to 125 per cent," RBI Governor D Subbarao said.

          RBI also capped housing loans to 80 per cent of the value of the property. It has been done to dissuade excessive borrowing for housing purposes.

          Currently, banks themselves put a cap on housing loans, but there is no ceiling from the RBI side. "RBI thinks such measures will control prices.

          In our view, prices can only be controlled by improving the supply," the country''s largest realty firm DLF Group Executive Director Rajeev Talwar told PTI. On BSE, DLF shares plunged 3.28 per cent, the most on Sen. Realty Index was the biggest loser among the 13 sectoral indices on the Bombay Stock Exchange.

          Also, mortgage leader HDFC shed 0.93 per cent and ICICI Bank declined 0.04 per cent. Not ruling out the possibility of default from teaser rates, RBI raised provisioning of these loans to two per cent from the current 0.4 per cent.

          It also means that banks will have to keep aside more money, while providing teaser rates. "This practice (teaser home loans) raises concern as some borrowers may find it difficult to service the loans once the normal interest rate, which is higher than the rate applicable in the initial years, becomes effective," Subbarao said.

          Parsvnath Developers Chairman Pradeep Jain said teaser rates might be removed. "Home loan rates will not increase because of the RBI''s actions," SBI Chairman O P Bhatt said.

          "The step indicates cautionary stance of the central bank against any kind of bubble in the realty sector," SMC Wealth Management Service CMD D K Aggarwal said. IDBI Federal Life Insurance CIO Aneesh Srivastava said "Hike in provisioning requirement for teaser rates from 0.5 per cent to 2 per cent for banks will have some impact on the lenders which have offered such loans.
          Download our Android App! | Please Read IREF Rules | FAQ's

          Comment

          • #6

            #6

            Re : Home loans

            RBI Tightens Provisioning Norms for 10:90 Loans- Builders Face Cancellation

            The 10:90 bubble’s going phut, contrary to the view of developers who were convinced that the innovation was a perpetual goldmine. The scheme, under which a real estate buyer paid only 10% of the property cost at the time of booking and 90% at the time of possession, was the buzz during the festival season.
            However, it was felt that such loans were risky for banks and so the Reserve Bank of India (RBI) stepped in and tightened the provisioning norms for such loans. Bank approval rates for these loans have fallen steeply since then, because of which it is the builders who are now staring at possible cancellations.
            Builders such as Indiabulls Real Estate (IBREL), Lodha Group and Nahar Group are among those to have floated this scheme. Analysts said banks were rejecting loans because buyers failed the eligibility norms. Less than a sixth of the loans for such projects were getting passed, an analyst said.
            “Such buyers are cancelling their bookings,” he said. Another Mumbai-based analyst with a foreign brokerage said some top builders stopped this scheme two-three weeks back. The RBI intervention would not have an impact on its sales since loans are yet to be sanctioned, he said.
            Many developers are charging Rs23,600-28,000 per square feet for these properties, he said, adding, “When oversupply brings down prices and buyers default on payments, banks will be forced to sell these properties at big discounts, which will burst the bubble.”
            Lodha Developers has sold 70 of the 100 flats it had put up for sale under this scheme, said R Karthik, senior vice-president - marketing, Lodha Group. The average cost of the 3000-4000 sq ft flats was Rs10 crore and a tenth of the buyers did not opt for the 10:90 scheme. “Our buyers have tied up with Axis bank, IDBI, HDFC and SBI. It was a short-term scheme to get people like CEOs and financial services professionals into this segment,” said Karthik.
            An official spokesperson of IBREL said the company has 300 bookings for its projects including SkySuites and Sky Forest, of which 100 clients have received loan sanctions, while 7 applications were rejected.
            A senior official of State Bank of India, the biggest home loan provider, said, “One developer had come to us, but we need a margin of 15%, corporate guarantee of the mortgage of the property and 25% equity for home loan. They had already tied up for mortgage with other consortiums so we did not tie up for this scheme. And we give loans in a 25:75 ratio and in some special cases at 15:85, but not beyond that.” That ruled out the 10:90 schemes.
            Banking sources said, “The agreement is clearly between the bank and the buyer, so if the developer tomorrow doesn’t pay or defaults, it is the buyer who has to pay up. Also, the sanctions have been very few as banks are becoming strict and only 10-15% sanctions have come from ICICI; HDFC’s sanctions are even lesser.”
            An analyst from another domestic brokerage said, “Some builders are giving loans through their non-banking finance company under this scheme. But what happens if cancellations start happening as loan approvals are so few? The revenue that they have already booked for the second quarter will go for a toss.”
            The problem with the 10-90 scheme is also that developers agree to pay interest only till the construction is completed. A buyer, on the other hand, gets possession only after the civic authorities give the occupancy certificate, pointed out an analyst with a foreign real estate consultancy.
            “So you have this one-year gap because OCs normally take that much time after the construction is complete. That would mean buyers will have to foot the interest bill for the period.”
            “If the developer is selling property claiming it would undertake interest subvention for that period, then the buyer should ensure that mentioned clearly in the agreement,” the aforesaid consultant said.
            Ambar Maheshwari, director of investment advisory services, DTZ, another consultancy, said, “The scheme has many fallacies right at the beginning. It’s the buyer who will have to pay if the developer defaults or delays the construction schedule. Also, here, the bank is taking the risk to fund such a project, which is generally bought out by investors.”
            Banks have also become wary of giving out such loans because their regulator, the Reserve Bank of India, looks down upon such lending practices. “So our management is not going to roll out the schemes in a huge manner,” said the official of a top public sectorbank.
            Download our Android App! | Please Read IREF Rules | FAQ's

            Comment

            • #7

              #7

              Re : Home loans

              RBI Eases Real Estate Lending Norms for Urban Cooperative Banks

              Urban cooperative banks (UCBs) have been allowed to lend more freely now, especially with regard to home loans and advances to the realty sector. The new rules were part of a slew of notifications by Reserve Bank of India easing the norms last week. This is a sequel to the announcements made in the second quarter review of the monetary policy. As per the new rules, the limit for extending housing loans as well as advances to other real estate sectors has now been linked to the total assets of a UCB. The limit has been set at 10% of the total assets, as against the earlier limit of 15% of the total deposits. An additional limit of 5% of assets has been granted for home loans up to Rs 10 lakh.
              “Linking the limit to total assets will increase the available funds as these are much higher than deposits. Total assets include advances made by the bank, fixed assets, reserves as well as investments. The move is expected to boost the realty sector,” said chartered accountant BC Bhartia. For banks, deposits are a liability as they have to be paid back to the depositor, while loans being a source of earning are classified as assets.
              The apex bank has also doubled the limit for granting unsecured loans by UCBs. Now, borrowers will no longer have to subscribe to the shares of financially stronger UCBs before getting a loan. Earlier it was mandatory in every cooperative for a borrower to subscribe to the shares. The RBI has also relaxed norms for opening new branches and extension of area of operations for UCBs.
              For banks having a capital to risk weighted assets ration (CRAR) of 9%, the limit of granting unsecured loans to a single borrower has been doubled to Rs 1 lakh to Rs 5 lakh depending on the deposit base. For banks having a CRAR below 9% the limits have been set at Rs 25,000 to Rs 2 lakh as per the deposit base. Earlier, the limit for weaker banks, which included those having a low CRAR, was kept at Rs 25,000 for those with deposits up to Rs 10 crore and Rs 50,000 for over Rs 10 crore. Similarly, borrowers approaching a UCB having a CRAR of over 12% need not compulsorily buy its shares any more. It was mandatory for borrowers to buy shares up to 2.5 to 5% of their loans so as to provide capital to the banks. Now, banks with a higher CRAR of 12% need not go for such loan-linked capitalisation, says the RBI notification. CRAR is a benchmark of buffer capital lying with a bank as against the loans granted.
              Well-managed UCBs having net worth of Rs 50 crore have also been allowed to extend their area of operations beyond the state of registration. For this, the banks should also have CRAR not less than 10%, net NPA within 5% and continuous profit for last three years. Good banks can now also open extension counters without sending a proposal for approval, and the RBI has also asked such institutions to submit proposals to open new branches.
              Download our Android App! | Please Read IREF Rules | FAQ's

              Comment

              Tags: home loans
              Have any questions or thoughts about this?
              Working...
              X