There is some good news for retail home loan borrowers who witnessed either pay cut or job loss during the Covid-induced lockdown. They may get further EMI deferment from their banks as part of a loan restructuring after August 31, when the RBI-granted moratorium ends.
According to a report in the Times of India, lenders, including SBI, are working on restructuring options for home loans where the overall tenure of the loan does not extend by more than two years, even after relaxing the repayment schedule.
In cases where borrowers have suffered total loss of income, banks may allow EMI deferment for a few months. In some cases, step-up EMIs, with a lower payout for a couple of years to make up for a reduction in salary banks due to the Covid-19 pandemic, the daily mentioned.
The publication citing sources mentioned that banks will draw up their own proposals which will be submitted to their respective boards by early next month after getting an idea of the number of borrowers facing stress.
Worth mentioning here is that banks have requested the RBI to allow one-time restructuring of loans as they don’t want to classify defaulters as non-performing loans. Banks also don’t want to enforce security and attach assets amid the pandemic.
