Home Loan Borrowers Cheer as NHB Introduces Independent Mortgage Counselors

By Dr Suvrokamal Dutta

It was long overdue, but can set the trend for borrowers to get educated. Prospective home loan borrowers can now take the services of independent mortgage counselors to be introduced by the National Housing Bank (NHB).

The best part about these counselors is that they are going to guide borrowers through the maze of financial terms and the implications of various loan terms on offer by banks and housing companies. In addition, they will help borrower prepare a budget, which they can afford.

Point to be noted here is that in an increasingly complex market, home loan borrowers are floundering, unable to comprehend the nuances of various products and are looking for a authentic source of information to assist them negotiate a proper deal.

It has come into the notice of The India Street that the National Housing Bank has sought to introduce a system of mortgage counselling and the first batch of Certified Independent Mortgage Counsellors (CIMC) should hopefully come in towards the end of this year.

In my opinion, a CIMC will help bring in fairness and transparency and would be of value to both the borrowers and mortgage originators. Lots of industry observers feel that plenty of housing finance companies are not transparent in the way they word their agreements or the loan conditions and complaints galore from borrowers who have felt cheated and let down.

Keeping all these things into perspective, home loan activists and participants in the industry have welcomed the move by NHB. “Customers should not shy away from having to pay the mortgage counsellor’s fees as taking their advice would help them save much more over a period of time,” pointed out Bhumi Veerani, investment and property advisor.

No one will argue with the fact that there are plenty of financially illiterate people in India, who need the services of a professional. On the downside, it is of paramount importance that counsellors should not act as agents of home loan players. That is where, professional counsellors found to be acting as agents should be blacklisted and disqualified.

For ensuring the success of the concept, NHB has laid down the criteria for eligibility of CIMC, the procedure for accreditation, renewal of accreditation and suspension of accreditation. The grievance redressal cell would be the key to the success of the scheme. Over a period of time, the NHB expects the counsellors to become a self-regulatory body, which would conduct itself with fair practices.

Suggested Reading:

Indians Should Carefully Examine the Benefits Paying Off Their Home Loans