Home loan borrowers will get refund if builder delays project, says SBI
Mumbai: Country's largest public sector lender State Bank of India on Wednesday announced a 'residential builder finance with buyer guarantee' (RBBG) scheme aimed at giving a push to residential sales and improve homebuyers' confidence.
Under this scheme, the SBI will issue a guarantee for completion of select residential projects to customers which have availed home loans from it.
The scheme will focus on affordable housing projects priced up to Rs 2.50 crore in 10 cities, initially.
"We are committing that till the time a project receives an OC, there will be a guarantee which the bank will offer buyers who take loans from it. This will be a win-win situation for homebuyers, builders and the bank," SBI Chairman Rajnish Kumar said.
Under RBBG, the guarantee would be given by the bank till the project gets the occupation certificate (OC).
"Suppose a buyer has booked a flat in a project for Rs 2 crore and has paid Rs 1 crore, and if the project gets stuck then we will refund Rs 1 crore. The term of the guaranteed will be linked till OC," he explained further.
The guaranntee will be available for RERA registered projects and a project will be considered stuck after it crosses the RERA deadline.
Kumar further said this product will improve the confidence of the home buyers and increase the velocity of sales of residential units.
To begin with, SBI has tied up with city-based real estate developer Sunteck Realty for its three ongoing projects in Mumbai Metropolitan Region (MMR).
"All reputed builders fulfilling the prescribed criteria by the bank can avail loan between Rs 50 crore to Rs 400 crore," Kumar added.
Commenting on the tie-up, Sunteck's chairman and managing director Kamal Khetan said, "This memorandum of understanding is a win-win for our customers who would get the best value proposition for the best quality homes."