HDFC Bank Loan Restructuring: Benefits & List of Documents needed

HDFC Bank, the largest private sector bank in the country has released a list of frequently asked questions. In which the bank has answered all kinds of questions arising in the minds of its customers.

HDFC Bank Loan Restructuring: Reserve Bank of India provided loan Moratorium facility for bank borrowers during lockdown. Under this, the borrowers of banks were allowed to not deposit the installment for 6 months. However, this facility of RBI expired on 31 August 2020. Due to this, now banks have offered loan restructuring options to their borrowers by setting the terms and conditions themselves under the new guidelines of RBI.

Further, the bank has clarified that loans once restructured will be classified as “Restructured” in the credit report of the borrower. Can bank levy restructuring of loans? In addition, the minimum outstanding amount of Rs 25,000 is required to convert the credit card dues / loan.

Keeping this in mind, HDFC Bank, the largest private sector bank, has introduced the terms and conditions and eligibility rules of the loan restructuring process on its website. Along with this, the bank has also released a list of frequently asked questions. In which the bank has answered all kinds of questions arising in the minds of its customers.

Q1. What is the Restructuring or Restructuring Plan approved by RBI?
The RBI has provided a framework to banks and lending institutions to overcome the economic downturn faced by the Corona epidemic, which has led to significant financial stress among customers. As per the infrastructure and regulatory guidelines, HDFC Bank has formulated its policy for restructuring the loans of individuals / institutions affected due to Corona epidemic.

Q2. Who is eligible for reorganization?
Individuals and entities that are classified as standard. Or who have not defaulted with the bank for more than 30 days till March 1, 2020, and have remained the standard in all loans and facilities till date.
Reduction in income or cash flow is a loss of vehicle as the customer is to be financially affected by the corona epidemic.
The reduction in customer income and its financial impact will be reviewed on the basis of documents or information made by the bank. Which illustrates the decline in cash flow due to the Corona epidemic. The bank will assess the Reduction of the customer to pay the restructuring EMI based on the documents provided before providing the restructuring. In addition to the reduction calculation, the repayment track record of the customer and the responses given by the customer while taking advantage of the earlier postponement will also contain facts in the restructuring decision.

Q3. How do I get the benefit of restructuring on my loan?
To take advantage of restructuring or restructuring plan, you have to go to the bank’s website. Where the application and related information have to be filled. With this you can also contact the regional manager of your bank. The link will be updated soon for restructuring.

Q4. What are the restructuring options available to me?
You can extend the remaining period of the loan for a further period of 24 months to reduce your monthly EMI repayment burden.

Q5. Do I need to submit any documents to take advantage of Restructuring?
You have to submit the following documents to the bank to give you the current status of your job or business. In which salaried sleep and bank statement will be required for salaried borrowers. Bank statements, GST returns, income tax returns, industry certificates etc. will be required for self-employed borrowers / institutions.

Q6. Will electing a restructuring package affect my credit bureau report?
The loan / credit facility will be reported to the credit bureaus as ‘Restructured’ as per the set guidelines. Also all the facilities and loans of the borrower with the bank will be classified and reported as renovated. Even if the borrower is ‘Restructured’ for only one loan.

Q7. If I restructure my loan, will there be any process charge or other charges?
If you want to restructure your loan, the bank may charge a fee.

Q8. I have many loan or credit facilities with the bank. Do I have to apply for each of these loans separately?
In the restructuring application form, on the bank’s website, the bank will be given the option to apply for one or several loans simultaneously. The bank will assess the application of regulatory guidelines on the impact of the corona epidemic and the reduction of the repayment plan before the same is decided.

Q9. I have a credit card with EMI plans within the credit limit. Can I opt for restructuring of outstanding cards only and not EMI schemes?
Restructuring of the entire credit card balance including the loan within the credit limit will be done and converted to a separate loan account.

Q11. Is there a minimum arrear required to avail the restructuring facility?
A minimum balance of Rs 25,000 is required to convert a credit card or loan outstanding.

Q12. I am a self-employed or a unit with a small scale unit. Do I deserve relief?
As per the revised guidelines for MSME classification operated by the Government of India, self-employed individuals or entities falling under the MSME category can apply for relief under the MSME Restructuring Scheme. Please contact your regional manager for more information. The bank will request its self-employed customers to register themselves as MSMEs through the Government’s Enterprise Portal wherever applicable.

Here is the link to register .. https://udyamregistration.gov.in/Government-of-India/Ministry/of-MSME/online-registration.htm

Q13. Can I now apply for Restructuring as previously not able to apply for moratorium?
Restructuring plan open to all bank customers

Q 14. Which type of loans are not eligible for restructuring?
1. Loans for agricultural purposes and institutions and classified by the bank as agricultural loans
2. Agricultural Credit Societies
3. Financial Services Provider
4. Central, state and local government bodies
5. HDFC Bank employees
6. Exposure to housing finance companies that have already been rescheduled.

Note- Loans granted for commercial use will be entitled to relief under MSME guidelines, as indicated in point 12.

15. My loan was taken with a co-borrower or other. Will all co-borrowers of the original loan agreement be required to sign the amended Restructuring Agreement?
All borrowers or borrowers of the original loan will be required to sign to agree on any changes to the loan structure, including the Restructuring Agreement, in accordance with the set rules and legal requirements.

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