Policy on EMI Moratorium / Deferment

Background

On 27 March 2020, the Reserve Bank of India ("RBI") issued the 'COVID-19 – Regulatory Package' notification to mitigate the burden of debt servicing brought about by disruptions on account of COVID-19 pandemic and to ensure the continuity of viable businesses. 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, this board approved policy on EMI moratorium on account of COVID-19 pandemic ("Policy") has been 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 March 1, 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 individual case.

Moratorium and Methodology

1. This Policy allows for VHFC to permit a repayment moratorium on installments due and payable between March 1, 2020 and May 31, 2020 (“Moratorium Period”). VHFC may offer moratorium/deferment from 1 to 3 EMIs to borrowers, basis their 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 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. 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 were unable to service EMI / Pre – EMI falling due during the period between March 1, 2020 to May 31, 2020, subject to internal process, assessment and approval, unless a customer expressly conveys that he does not want to avail moratorium.
6. All EMIs and installments which are due and payable on June 1, 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 / instalments deferred during the Moratorium Period.
9. For availing the EMI repayment moratorium, VHFC shall not report the borrower as a defaulter in its own 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 customer request and assessment by VHFC, at discretion of VHFC. To avail the said moratorium, customers can submit their request via e-mail, SMS, voice recording, physical document or the Company's self-service portal.
2. Borrowers who do not wish to apply for the EMI repayment moratorium or who’s 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.