Ghost loans in housing sector under scrutiny

MUMBAI: The Reserve Bank of India is looking into complaints of ghost loans in the housing sector.
“This is always under our scrutiny but if we do get any complaints of that sort we do look into them and investigate them properly,” said SS Mudra deputy governor of Reserve Bank of India.

Ghost loans could be ones which are fictitious loans recorded in the books, or these can arise when the borrower on record has taken it at the behest of the real borrower.

“Issues within the housing sector are looked into by the National Housing Bank, but as per loans to the housing sector go... the Reserve Bank of India has its eyes on. There are not many such complaints.” The percentage of non performing assets in home loan portfolio is the lowest. The Reserve Bank of India said that there is no reflection of any excess stress.

“The practice of builders underwriting properties to intermediaries has been going on in the North for more than a decade,” said Anil Sachitanand, MD and CEO Aspire Home Finance.

“Fund avenues for a developer in real estate borrowing is confined to NBFCs, banks and FDI from private equity. They underwrite the property to an intermediary who at a right time sells it to individuals. Individuals do not want to buy property when it does not exist.”