Does project home guarantee make home buyers worry less?
A customer requesting a letter of guarantee is a necessary action to ensure minimal risk when purchasing a home.
To ensure the rights of buyers of future housing (called project housing), the Law on Real Estate Business stipulates that transactions must have a bank guarantee certificate. However, this type of guarantee has a fairly high level of risk.
According to the Ho Chi Minh City Real Estate Association, currently, in the city, there are 500 projects that are "shelved" because the investors are not capable of completing them. Most recently, hundreds of customers who bought project houses of Khang Gia Real Estate Investment and Development Joint Stock Company, located in District 10, Ho Chi Minh City, fell into a state of despair due to the information that this company is in the process of dissolving and is no longer operating in the locality.
Despite these shortcomings, buyers still accept “houses on paper” because the price is lower than that of houses already built and can be paid in installments over a long period of time. As for investors, this method mobilizes idle money, partially solving the capital problem.
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Many home buyers have lost all the money they invested in future real estate projects. |
In order to ensure the rights of home buyers as well as enhance the responsibility of investors, the Law on Real Estate Business stipulates: Before selling project houses, investors must be guaranteed by a bank and must be granted a license to mobilize capital after completing the foundation.
Mr. Le Hoang Chau, Chairman of the Ho Chi Minh City Real Estate Association, said that some businesses have recently committed fraud, causing great outrage in society.
“From this reality, there is a need to protect the rights of future home buyers, to ensure that in case the house is not handed over on time, the bank will compensate consumers for damages on behalf of the investor,” Mr. Chau pointed out.
For real estate businesses, the cost burden is a concern and this regulation also increases costs. Because in addition to paying land use fees, businesses also have to pay a guarantee fee. In addition, the approval process for the guarantee is relatively difficult and often takes a long time.
Mr. Truong Anh Tu, Business Development Director of Phuc Khang Real Estate Company, said that according to bank regulations, businesses that want to be guaranteed must have money or collateral equivalent to the guarantee value, and pay a fee of 2% of the guarantee value.
“This fee is not consistent in the market, so it will be guaranteed according to each stage of project development or each business phase of that product. All costs will be included in the price and the most disadvantaged person is the buyer,” said Mr. Tu.
On the bank side, one of the difficulties is that in addition to the large capital that has financed real estate projects, if the guarantee is added, there must be a new limit granted to the investor to issue guarantees to customers. It will be very difficult for the bank to increase the credit limit and ensure project progress.
Mr. Nguyen Van Hai, Head of the Legal Department of Orient Bank, proposed that in order to avoid the situation where the bank has to "take the hit" in case the investor fails to complete the project, the bank must take measures such as requiring the investor to report the purpose of using the loan and report the project progress to both the bank and the home buyer.
“According to the law, banks must lend for the right purpose and must control the use of customers' capital for the right purpose. If the bank finances the project, it is even better; the more money is invested, the more it is built,” Mr. Hai suggested.
In recent times, many home buyers have lost all their money invested in future real estate projects. Therefore, demanding their rights such as requesting a guarantee certificate is an action that customers need to take to ensure that risks are minimized.
According to real estate experts, with the increased costs of underwriting, buyers should consider this as the price for safety assurance when buying a project house. This fee is not too high compared to the potential risks in the real estate business process./.
The State Bank of Vietnam (SBV) has just announced an additional list of commercial banks that are qualified to provide guarantees for real estate investors to sell or lease-purchase future houses. Accordingly, the State Bank of Vietnam adds one commercial bank that is qualified to perform guarantee activities for real estate investors to sell or lease-purchase future houses at the time of announcement, which is Vietnam Construction Commercial Joint Stock Bank. Thus, up to now, the number of commercial banks qualified to carry out guarantee activities for real estate investors to sell or lease-purchase future-formed houses announced by the State Bank is 39 commercial banks, including 30 domestic commercial banks, 05 100% foreign-owned banks and 04 joint-venture banks./. |
According to VOV
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