Ratings for greenfield housing to aid buyers, builders & lenders

Mar 13 2014, 01:42 IST
Comments 0
Greenfield housing projects will soon come under a new rating system being developed jointly by mortgage regulator National Housing Bank and Indian Banks’ Association. Greenfield housing projects will soon come under a new rating system being developed jointly by mortgage regulator National Housing Bank and Indian Banks’ Association.
SummaryCheap credit, regulatory forbearance to be extended to rated projects.

get good ratings,” Verma said.

While the new rating system will cover greenfield projects initially, NHB and IBA may consider ongoing projects.

The rating will not be mandatory, but will be incentive-based and demand-driven. The rating is on a scale of 1-7. It will include a technical appraisal related to land acquisition, title, possession, approvals, planning, pricing, project viability on a standalone basis and the financial position of promoters. The escrow mechanism, where cash flows of the project will be kept aside, will also be considered during the rating. Also assessed will be the financial strength of the promoter and the project, technical and technological due diligence and market due diligence. All the risks associated with lending get mitigated. The rating will uniformly be advocated to the banks and lenders, including HFCs.

Single Page Format
Ads by Google

More from Economy

Reader´s Comments
| Post a Comment
Please Wait while comments are loading...