Those of you who watch ET’s Real Estate Channel Magicbricksnow – I must be a familiar face!!

I appeared a few times on the question answer chat with Kavita Krishnan – a real Real Estate expert (she has spent a lot of time on that subject, 10,000 hours as Malcolm Gladwell would say!).

One question she asked at the end of one of the shows is ‘Subra are people not taking too much of risk’?

Perfect question. Let me answer that in leisure.

For most of the middle class the single biggest asset in which they invest is their Residential home. Well, for most of them at least. So if you make a mistake in this asset purchase – bad title, litigation with the seller, court cases, property already sold to 2 other people, YOU ARE DOOMED.

So when I am asked the following questions:

  1. I have Katha B property (Bengaluru) and no big lender is lending to me what should I do?
  2. I am trying to buy a Gram Panchayat property and none of the big lenders are lending to me what should I do?
  3. The builder has just bought land and announced a project, Hdfc is not looking at that project, what should I do?
  4. I want to buy in xyz projects by a particular builder. Hdfc is not willing to consider it, but other lenders are willing to give, what should I do?
  5. I am eligible to a loan of Rs. 70 lakhs as per Hdfc, but I wish to buy a house where I have to pay about Rs. 95 lakhs, should I take a personal loan of Rs. 25L along with my wife and go ahead with the purchase?

The caveat first: I am a shareholder of Hdfc Ltd. So there could be a bias!!

I have a lot of respect for Hdfc, and I know that their strength is in their financial and other risk management techniques. So if they are telling you that they will NOT lend for a particular project, stay away. Respect their risk understanding ability. I may not like some of the other things that they do, but this group’s ability to understand risk is phenomenal. If Hdfc, Icici and SBI do not wish to lend money for a project, take that a signal. Recently a friend went to a Hdfc branch to ask for a loan, I read the loan document and found out that the building had a CRZ problem, I asked him to choose a different location. Is it too tough to do that?

Listening to the banker while doing a mortgage is far, far, far more important than listening to your spouse.

Merry Christmas



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  1. A very nicely summed up article on loan. Frankly speaking if marquee lenders like HDFC say no to a project, one should actually stay away and not buy it even if it comes at a cheap price and what not.

  2. So conversely, if say SBI is ready to give loan for a property, can it be taken that the property is reasonably sound?

  3. I would say , even if a project has been financed by HDFC , still be careful and get all approvals and documents vetted.

  4. Nagendra..see what I have said..”if Hdfc says NO, run away’. I have not said ‘Hdfc saying yes is enough’ – you may still do your due diligence (for me it is sufficient that Hdfc says yes)..

    mathematically speaking, Hdfc’s yes is a necessary but not sufficient condition..but if it is not there, do not waste time…

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