I bought a property under subvention scheme which mentions that no emi till possession. As per the RERA the possession date is Dec 2022. When I received the Tri Party Agreement, it was mentioned that the pre emi interest will be borne by the developer till July 2020 only. I refused to sign the TPA agreement. When I asked the builder why the TPA does not mention Dec 2022, to which builder told me that if they mention 2022, the bank will deduct the interest till 2022 and balance amount will be handed over to the builder for construction. To avoid this loss, he has mentioned July 2020 and not Dec 2022 in TPA. He is not agreeing to revise the TPA however, agreed to give in writing in his letter head that the Pre emi interest amount from July 2020 till possession will be made by him directly to me in case there is delay in possession beyond July 2020. Please advise whether I can proceed with the disbursement and sign the tpa based on what is mentioned in the letter head. So far I have made the SDR payment, GST and 20000 booking amount. Moreover, the builder told me that in case of underconstrction property, bank will collect only pre emi interest and can not collect EMI ( principal and interest) until posession. Please confirm the same
Sir the builder is right in making statement that the bank will collect only the pre emi interest and will not collect the EMI the EMI will start from at the time the flat is registered to you and possession is given,
Further don't take in writing on the letter head ask builder to mention in TPA actual possession date as per agreement otherwise the bank can call upon for EMI, further if he refuses to agree file a RERA complaint on the same ask builder to write the actual dates,
1)you can proceed with disbursement and sign TPA based on builder written assurances that in case possession is delayed beyond 2020 he would continue to pay pre EMi till date of possession
2)Pre-EMI is just the interest portion on the disbursed loan amount that you pay until the full disbursal is done. i.e., your home loan behaves like an interest-only loan on the disbursed amount until the completion of construction.
1. in a subvention scheme prior to hand over of formal possession with OC, the buyer is not liable to pay the principal component of the EMI and only has to bear the interest component of the EMI
2. the interest payment liability is taken over by builder under the scheme and he has to bear the interest till he hands the possession with OC
3. once loan is sanctioned by bank, the entire purchase money is paid by bank to builder - so there is no question of any deduction of interest from the loan amount
4. the builder has mentioned a sooner date only to dodge his liability of being liable to pay the pre-emi interest till actual possession date
5. what if the builder defaults in completing the construction even by the date mentioned by him on RERA website?
6. the builder has to stick to the stipulated date of handover of possession as mentioned on RERA webiste upto which he will be liable to pay the pre-EMI interest and also continue to be liable to pay the interest till the time he actually hands over possession to you (in case he makes default in handing possession by stipulated date)
7. ask the builder to execute a separate agreement with you wherein he confirms that inspite of what is stated in the TPA, he will continue to be liable to bear the pre-EMI interest till the date of actual handover of possession to you
8. a separate agreement is better than a mere letter head confirmation. Also this agreement can be notorised on 100 rs stamp paper. No registration is required as there is no transfer of property involved.
1. If he is ready to give the same in writing on the letter head then the same will be sufficient prove for you to defend the case later in court (if required).
2. Yes the builder has informed you rightly.
These are general practices which are prevalent in the market.
Regards
Yes he is right that in case of non finished properties any dispersal by the bank attracts only interest portion and in case builder is agree to compensate your interest portion after 2020 then there is no problem in case of any default from the builder then you have the option to go to the consumer forum against the Builder as this one's and scheme is covered only upto 2020 I believe there is no problem in this deal you may go ahead
Giving an assurance on his letter head cannot be said to be a document which can be enforceable in law, it may support the case to some extent as an evidence.
Of course the bank would collect pre-emi interest till such time the construction is completed, but if there is an inordinate delay, then the bank may follow its own rules in this regard, which may not be disputed.
