State Bank of India (SBI) on Wednesday announced a unique scheme to safeguard homebuyers financially by issuing guarantee for completion of projects to customers availing SBI home loans.
The new scheme, the Residential Builder Finance with Buyer Guarantee (RBBG), will enable home loan customers to seek refund if a builder fails to meet the deadline under the Real Estate (Regulation and Development) Act. Customers will be able to secure their investment in the ongoing home projects financed by the bank itself. Customers will now be able to avail of a full refund of the principal amount if the builder fails to handover an occupancy certificate (OC) within a stipulated time.
RBBG will focus on affordable housing segment with home price of up to Rs 2.5 crore in seven cities initially. Under this product, all reputed builders fulfilling the prescribed criteria by the bank can avail loan between Rs 50 crore to Rs 400 crore, SBI Chairman Rajnish Kumar while launching the scheme.
The criteria includes star rating and CIBIL score, SBI said.”We believe that RBBG will build confidence among homebuyers by securing their hard-earned money and at the same time will boost under-stress real estate sector. This product is yet another effort by SBI to make affordable housing conveniently accessible to the individuals with dreams of owning their desired home,” Kumar said.
“Based on the response from both builders and customers, we may consider extending this product to other parts of the country,” he added. On December 30 last, SBI announced a sharp cut of 25 basis points (bps) in its external benchmark-based rate to 7.80 per cent per annum from 8.05 per cent per annum, effective January 1, 2020. As a result of the move, new homebuyers will now be able to avail themselves of home loans beginning 7.9 per cent, which is 25 bps lower than the current offering of 8.15 per cent.
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