Real Estate project finance still requires a lot of development in a country like India. More than 25% of people still live in rented houses & dream of buying their own homes. This requires developing affordable & mid-range homes for these genuine buyers.
But the real estate industry faces many issues like escalated prices so creating a lack of buyers & lack of finance facility for the real estate industry. The Real Estate project industry needs lots of attention from the government to offer some immediate grants & ease out the banking industry norms. Also, a lot of real estate dedicated fund houses and NBFCs need to be pumped into the economy.
Procedure to Get Real Estate Project Finance in India
Here we are explaining some sure-shot ways to raise Real Estate Project Finance in India to get funds for completing developers’ construction projects in India. There are five simple steps to achieve the goal :
1. Understanding the Market:
The developer first needs to understand the current market & financial products available in the market for the real estate market. These days most of the previous banks & regular NBFCs are not interested in giving funds to real estate developers or construction projects.
2. Understanding the Policy:
The developer must need to understand the lender’s policy and who is willing to extend the facility to developers for a construction project loan. Ideally, these new-age lenders are interested in projects in which construction is already started & achieves a construction benchmark of say 20-30% at least. Also, residential projects get priority over commercial projects.
3. Preparing Loan Documents File:
After understanding the market & latest financial trends, the developer needs to prepare a loan document file which consists of the following documents:
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- Group Profile
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- Project Report(CA Certified)
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- Plot Layout plans
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- Building Plan
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- Commencement Certificate
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- AAI Height Certificate
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- Fire NOC
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- RERA Certificate
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- MOEF/SEIAA/SEAC Approval
4. Loan Application:
After getting ready with all the documents, a developer can apply for a loan by filling out the application form of the respective lender. These days online application forms or lenders require some information about the project in the first stage so that it can be collected through a format shared by them. Developers can fill these formats completely & submit them to start the financing process.
5. Lenders or Financiers:
As per our suggestion one company that is very prominent in providing Real Estate Project Finance is Fund Source India, they provide loans for real estate projects in all major cities of India & loans starting from Rs.5 crores to any amount required. They provide tailor-made financial solutions as per project requirements & cash flows.
Advantages of Taking Real Estate Finance through us
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- Flexible Loan Amount: Loan amount starts from Rs.5 crore to any amount required by the developer
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- Lower Interest Rates: Interest offered is very competitive interest starting from 12% to 17%
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- Stuck or Stalled Project: This finance facility is also available for Stalled or stuck projects in which construction is on hold due to some unavoidable circumstances.
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- NPA Declared Projects: This finance facility is also offered for NPA-declared projects where the developer takes a loan on the project, but fails to repay on time hence the loan account is declared NPA.
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- Flexible Repayment Plan: A flexible repayment plan is offered with a moratorium period & repayment can be done through an escrow mechanism also EMI will be collected as per sale of units/inventory.
