Builder misquoted the total cost of apartment

POSTED BY Rohit ON July 25, 2012 11:29 pm COMMENTS (5)

I have recently booked an apartment and thereof applied for a home loan from SBI.

All the loan processing was being done via an agent who was referred by the builder so even my loan application was filled by the agent,i just mailed him the required details.

My builder gave the cost breakup sheet directly to the agent which had the wrong value of the total cost i.e if my house was actually costing 50 lacs it was quoted to be say 52 lacs.
So now my loan has been sanctioned but the application says the property value as 52 lacs instead of 50.

Now my question here is what could be the implications of this to me,i am yet to go for document verification at the bank and i have both the cost breakup letter with me the one which says 50 and the other which say 52.

One implication that i see is that my margin % would increase and that would lead to more contribution from my side as well as bank would also not release the entire loan sanctioned.Would that cause a problem?

5 replies on this article “Builder misquoted the total cost of apartment”

  1. Dear Roshit, Had you asked your builder for any clarification for this thing? If yes, what was his reply? If the property value is quoted as 52L Rs. to bank & the actual agreed value is 50L Rs. only, the actual disbursal of the loan ‘ll be on the 50L Rs. value by the bank.

    Thanks

    ashal

    1. Rohit says:

      Thanks Ashal for your reply.
      Ya i asked my builder he said that by mistake they have done that and he has given me the rectified letter also.
      But my problem is that i have already applied for loan,it has been sanctioned also and at the time of application i have given the xerox of the old cost breakup letter with wrong property value.
      So now i m not sure whether to submit the new rectfied one to the bank or the old one only.

      1. Dear Rohit, please sit easy. What I understood from your query, the basic cost of the property is 50L, wrongly quoted price is 52L, loan is sanctioned on this wrong price of 52L Rs.

        Well, the bank ‘ll disburse only that much amount @ 20-80 or 25-75 ratio for what value the property ‘ll be registered. Any excess amount sanctioned by bank but not utilized by you ‘ll remain with bank & you ‘ll not be charged any interest on this un-utilized amount.

        Thanks

        Ashal

        1. Rohit says:

          Thanks Ashal,
          I understand that no interest would be charged for unused amount but the only worry i have is that bank has the xerox of all the documents(originals are yet to be submitted) including my sale agreement and cost break sheet.
          Now sale agreement is for 50 lacs (the correct amount) but the cost sheet is for 52 so there is a discrepancy there.So i am not sure shud i submit the correct documents which would lead to bank asking me questions on the difference in application and the document and may even lead to cancellation of loan or i should submit the wrong document itself.

          Apart from this the increase in property value has increased my margin share in the loan which implies i need to pay more from my side.

          1. Dear Rohit, please proceed with the actual valuation which is 50L Rs. Please inform the bank in advance from your side for the goof up created by the agent. It’s not a big issue & bank staff ‘ll co-operate you for reduction of loan amount as well as property valuation in loan documentation.

            Thanks

            Ashal

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