Policy on EMI Moratorium / Deferment

Background

On 22nd May 2020, the Reserve Bank of India ("RBI") issued guidelines which were in continuation of its guidelines published on 27th March 2020 and 17th April 2020 announcing specific regulatory measures in the wake of the disruptions on account of COVID‐19 pandemic and the consequent asset class if ication and provisioning norms. The intensification of COVID‐19 disruptions has imparted priority to relaxing repayment pressures by mitigating the burden of debt servicing, prevent the transmission of financial stress to the real economy, and ensure the continuity of viable businesses and households. Vastu Housing Finance Corporation ("VHFC" or "Company") is committed to helping its customers who are financially affected by the disruptions brought about by the COVID‐19 pandemic. Accordingly, the Company approves the revised Policy on EMI moratorium on account of COVID‐19 pandemic ("Policy") is being issued as follows.

Eligibility of Loan Accounts

1. An outstanding Housing Loan or Loan Against Property availed from VHFC, which was classified as a 'standard asset' as on 29th February 2020 in VHFC's records, will be eligible for consideration under this Policy. Further, loan accounts/ borrowers in respect of which legal proceedings are underway, for any reason whatsoever or which have been written off, shall, in any case, not be considered under this Policy.
2. The application of this Policy/ granting of repayment moratorium for a particular loan account shall be done on a case‐to‐case basis, after an evaluation of the merits of each case.

Moratorium and Methodology

1. This Policy allows for VHFC to permit a repayment moratorium on installments due and payable between 1ˢᵗ June 2020 and 31ˢᵗ August 2020 (“Moratorium Period”) for the customers who were granted moratorium earlier and continue to be allowed so. It also provides for a fresh set of Customers to apply for a moratorium for the period between 1ˢᵗ June 2020 to 31ˢᵗ August 2020 (“Moratorium Period”). VHFC may offer a new moratorium/deferment from 1 to 3 EMIs to borrowers, basis the Customer’s request, and an internal evaluation of the request during the Moratorium Period.
2. As per this VHFC Policy, the Borrower shall be allowed to defer the payment of EMIs/ installments payable during the Moratorium Period. However, the Borrower shall continue to be liable for each of these installments not paid during the Moratorium Period.
3. During the Moratorium Period, interest on the outstanding balance will continue to accrue as per the existing rate of interest.
4. The EMIs/ installments which were deferred during the previous and revised Moratorium Period shall be payable by the Borrower at a later date as per a revised repayment schedule issued by VHFC. VHFC may increase the loan tenor or EMI amount or a combination of both, as appropriate.
5. Moratorium would be granted to customers satisfying the eligibility conditions in Para 1 and who were unable to service EMI / Pre EMI falling due during the period 1ˢᵗ June 2020 to 31ˢᵗ August 2020, subject to an internal assessment that that the moratorium extension is necessitated on account of the economic fallout from COVID‐19. Considering the financial acumen of our customers and current lockdown situation it would be difficult for the Company to explain in person or through call centers the effect and impact of moratorium scheme to each and every customer and take their confirmations, and hence we assume that we may not receive timely confirmation from all the customers and hence moratorium benefit will be passed on to all the customers who are deemed eligible after the internal assessment unless a customer expressly conveys that he does not want to avail moratorium.
6. All EMIs and installments which are due and payable on 1ˢᵗ September 2020 and later shall be paid by the Borrower in the normal course.
7. The Borrower shall execute all such documents, deeds, cheques, NACH Forms, etc. if any required by VHFC.
8. The Company will not levy any cheque bounce or overdue charges on the EMIs/installments deferred during the Moratorium Period.
9. For availing the EMI repayment moratorium, VHFC shall not report the Borrower as a defaulter in its records, or with any credit bureaus/ CIC or RBI. RBI has separately stated in its guidelines that credit bureaus/ CICs shall ensure that the actions taken by lending institutions pursuant to the above announcements do not adversely impact the credit history of the beneficiaries.

Process

1. The EMI repayment moratorium under this Policy will be granted basis assessment by VHFC, at discretion of VHFC, as explained in Para 5 above.
2. Borrowers who do not wish to apply for the EMI repayment moratorium or whose application for EMI repayment moratorium has been rejected/ withdrawn by VHFC should continue to pay their EMIs as per the existing repayment schedule. Normal NACH banking will continue as is for customers who do not opt or qualify for the moratorium facility.
3. Revised terms and conditions and repayment schedule will be shared with the approved Borrower.
4. The Borrower shall execute all such documents, deeds, cheques, NACH Forms, etc. as may be required by VHFC as per the additional requirements of the Company if any.
5. The EMI repayment moratorium shall be applicable only upon an express communication/ notice made by VHFC to the approved Borrower in this regard.
6. During this period, the Company will endeavor to engage with customers with empathy and understanding in a considerate and supportive manner.

Deviation Authority

The Policy provides authority to the MD & CEO, CFO, Head ‐ Operations, Head ‐ Underwriting, Business Head or any other person as delegated by MD & CEO for decision in the case in question. MD & CEO is authorized to approve any operational procedures/guidelines as may be required to implement the Policy and make any changes to the Policy in line with the directions/guidelines issued by RBI from time to time.

Amendments to this Policy

The Board of VHFC may make suitable amendments to this Policy as may be required. This Policy is subject to any further directions and guidelines issued by the RBI from time to time.

Display on Website

This board approved Policy will be hosted on VHFC’s website as required under RBI guidelines.