Saturday, June 18, 2016

Required - Builder's Credit Report & Credit Score Rating

CIBIL - Credit Information Bureau (India) Limited - evaluates the eligibility of the home loan borrowers. 
How about establishing an agency which will evaluate the performance & credibility of the builders?:

In June 2014, I booked a 1 BHK Flat in Sainath Palace - a single stand alone 4 story building of 16 flats - at Wagholi.

I booked in this project only because - 70 % construction was ready and the builder - Mr. Amey Prakash Lokhande - promised to give possession in 6 months - means in December 2014.

Possession in 6 months means - I had to pay both - the rent and the Pre-EMI - only for 6 months.
Possession in 6 months means - just after the 6 months - I have to pay only EMI. Which was as good as my current rent.

Financially - paying both only for the 6 months was quite manageable.

However, today, in June 2016, 2 years after the booking, I haven't received the possession of my flat. And I don't know when I will get it.

It means that - I don't know how long I have to keep on paying both - the rent & the pre-EMI.

Can I manage to pay both for so long?

What if I can not manage to pay both in a month?

For the last 2 years - these questions are bothering me day & night.

Till I get the possession of my flat - I have to live in a rented flat - obviously, I don't have any option but to keep on paying the rent.

Since I have taken the home loan - though the construction of my project is stalled - I don't have any option but to keep on paying the Pre-EMI.

Yes. True. I have to pay both every month.

But - what if I can't manage to pay the both?

What - only in a month or two - if I can pay only one - either the rent or the Pre-EMI?

For the obvious reasons, certainly, my first priority would be to pay the rent.

But the fact of the matter is - not paying the Pre-EMI for a month or two - will damage my credit worthiness - my CIBIL ratings. Result is - low CIBIL ratings would hamper my eligibility to obtain a loan from any bank. And I will suffer for life.

But - what happens to the builder who puts me in such a challenging situation by delaying possession of my flat?


Because, like CIBIL - there isn't any authority which rates the builder's' performance!

Don't you think that this is unfair?

Don't you think that the government must establish an agency which will publish an authentic credibility report of the builders?

Don't you think that an authentic credibility report of the builder will help the property buyers to decide whether the builder is eligible to book a flat at an under construction stage of the project?

This is an approximate summary of the above Marathi Video Interview of Doctor Devidas.
What say you? Do you agree with him?
Do you think that Builder's Credit Report & Credit Score Rating would be useful?
Please, share your views in the comments.

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1) In 2016 - where to book a flat in Pune real estate market? (Part 1)

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  1. It is important for the customer to understand the credibility of the builder by look after for the past project experience and try to avoid the new or experienced developers.
    People are going with these kind of developers due to some budget issues and getting in trouble of above mentioned issues.
    Although govt is not having any control in this kind of developers till now, so please be aware and buy safe.

  2. Almost all builders have collected VAT & service tax forcibly without proper calculations & invoice from buyers. This was open loot by Pune builders, thanks to CREDAI.
    It was here a strong signal was given by builders to buyers that we are here to loot you, even if you are existing buyer.
    When intentions of builders are clear, the buyers too should make their intentions to builder clear - by buying ready possession flat with all approvals & totally avoiding under-construction project even if it is 70-80% complete.

  3. Dear amit,
    what u say is right but partly, as seniority & experience is important not just for builders but in any industry, yet that doesnt mean whatever senior builders do is always right! They charge heavy premiums for their brand as well even senior names have faltered in their promises rather in market presently its bigger names which have made industry to look down! What I feel is a right is right, so as a customer look for what is right than just big name, like u said in last lines of comment, be a wise client & do buy with open mind as well eyes is the solution!Take advise of some wise person who knows the industry & then u conclude analyzing all fronts.

    1. Hi Sanjay, Your point is correct that's the reason I said take the wise decision by analyzing all the aspects not only in the matter of Name. Some how credit policy is not available in the Real estate market so the past records will help, rather going to less experienced.

  4. Hi,
    "Builder's Credit Report & Credit Score Rating" will be an excellent idea.
    But it should be handle by independent body which will not going to get under influence of builder. (which I think rare, as tell me govt department which hold good power and not in contact with real estate)