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Real estate body asks for deferment of home loan EMI
ET Realty  |  March 25, 2020

ET Bureau

Real estate developers body are asking for deferment of housing loan installments for 12 months, moratorium on project loans for 2 years, release of building plans and other approvals which are being help-up due to payment of fees among other measures to support the real estate industry in UP and Haryana.

 

The National Real Estate Development Council (NAREDCO-UP) has written to Nirmala Sitharaman, Finance Minister, asking them for relief for the sector in this tough time.

 

“Due to Covid-19 impact, Housing sales are almost nil. There are no buyers in the market, naturally value of housing prices is zero. We have asked for certain relief package from Finance minister,” said Supertech Chairman RK Arora, who is also as the presidents of Naredco- UP.

 

In order to overcome the impact of the pandemic, NAREDCO has said that it is essential that all the project loans disbursed by the banks, are allowed unconditional moratorium of 2 years during which period, no project account should be treated as NPA and no recovery proceedings should be initiated against any developer. It has also requested that All NCLT/DRT cases against the developers are withdrawn.

 

To ease liquidity to retail home buyers who have taken home loans but due to pandemic situation needs liquidity support, the body has asked for 12 months deferment for payment of EMI towards home loan instalments. During this period waiver of additional interest, penal interest may be allowed.

 

The Haryana chapter of Confederation of Real Estate Developers’ Associations of India (CREDAI) has asked the Haryana government for the relaxation in rules and regulations for the developers.

 

“The real estate sector contributes to 10% of the National GDP and is the second-largest employer in the Country and due to this pandemic the real estate industry would be drastically impacted. We believe that relaxations would be in the larger interest of not only of the sector but all stakeholders including the customers and in the absence of relaxations in rules and regulations the real estate industry would hit all-time low and suffer irreparable damage,” said President, CREDAI Haryana, Kushagr Ansal.

 

CREDAI has said that the sector is already facing acute shortage of construction materials due to import restrictions and shut down of state borders leading to supply-chain issues and heavy escalation in prices of materials. Construction sites have been locked-down due to the Covid-19 virus.

 

“Untimely payment from the customers is another critical issue in the present market conditions and after this pandemic, the customers might not be in a position to make the payments and this would be a major setback for the sector. On the other hands, Developers are under extreme pressure from the authorities, financial institutions for meeting their deadlines and for payment of loan installments on time,” it said.

 

The body has asked for exemption of payment of interest on external development charges and internal development charges for one year starting a February 15.

 

It has also said that process of necessary approvals for the development of a Project shall be taken up with urgency without the prerequisite of Bank Guarantee(s) and other charges.