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Proceed With Caution


Let's start the topic on a positive note. In the real estate market, 3 out of every 10 builder you come across are extremely professional in all aspects. They will never try to influence your decision on choosing the home loan partner. They will allow you to choose the partner.

However, the issue is with the remaining 7 builders of the equation. They are over ambitious by nature.They will directly or indirectly try to influence your decision on the home loan partner you choose. This is where you need to move with caution.

Why are these builders so much interested in your loan being taken from “A” bank or from “B” bank and not with “C” bank although you may have personally heard good opinion about the Bank “C’.

The reason is simple. There is a vested interest for the builder in pushing you to a bank of his choice and not let you proceed with the bank of your choice.

The builder will be least interested in how the Bank “A” or Bank “B” or the Bank “C” treats your loan account after the loan is taken. They have their own agenda and it may not necessarily match with the well being of your home loan account in the future.

Imagine a property worth Rs 80 lakhs with a loan of Rs 64 lakhs @ 8.7% for a period of 15 years. The total repayment you make not factoring in any pre-payment will be Rs 1.15 Cr (aprox). Let’s say you pay Rs 15k part payment every month. Even then the total repayment you make is Rs 97 lakhs (approx). The amount you end up repaying is still much more than the property value itself & you may take a life time to repay that. Why will you allow the builder or the builder’s sales man to influence you in such a big financial decision of your life?

And as digiHOMELOAN users you must remember the reasons cited by them to hook you to the bank of their choice

1) Sir/Mam..... “In this bank the customer service is bad and in that bank it is very good” ( Why is he so much interested in the customer service that you get on the loan)

2) Sir/Mam..... “The bank “C” takes more time and the Bank “A” or Bank “B” bank will do it faster. Our management will not wait for more than 30/45 days for the loan to be disbursed." (He and his management often wait for more than 3/6/9/12 months from walk-in to booking of the apartment by the customer but suddenly the wait period for the loan processing & disbursement comes down. Hmm.....Dal mein kuch kala hai)

3) Sir/Mam..... “This bank will come to your house for everything and in that bank you will have to go to the bank” (As if that matters for decision of a lifetime)

4) Sir/Mam..... “ We have taken a project loan from bank ‘A ‘ or HFC ‘B’. It will be very easy if you take the home loan from them.” ( Let the project finance be from the Bank ‘A ‘ located in Timbuktu or from a HFC ‘B’ located in Honolulu….you as a customer can still take a home loan from the bank of your choice.)

5) Sir/Mam….. “Our project is approved by all major banks & HFC’s except Bank ‘C’. We had approached them but they kept asking for many legal documents and they take a lot of time for project approval. So our management has given up.” ( The project approval from Bank ‘C’ will certainly not take more time than what it takes to get the plan approval from BBMP or BDA in Bangalore.)

6) Sir/Mam..... “ The bank ‘A ‘ or HFC ‘B’ is giving a No EMI till possession scheme. Please take the home loan from them.” (Please read about the legitimacy and cost complexity of such schemes in the EMI Options topic of our consulting section before you take the final decision.)

As digiHOMELOAN users, with all the know-how to deal with these builders at your disposal, you are not going to let them influence you on such an important financial decision of your life.

It is you who will select the home loan partner on the basis of merits and demerits of individual banks, their interest rate model, safety factor etc.