Mantri developers has put hoardings in Bangalore and full page newspaper ads about a "NO EMI offer" in three of their projects(refer attachment). This might be too tempting to invest.
First. this is not the first time Mantri Developers is offering this scheme. This scheme was first offered in 2013-2014 time frame. And despite cheating customers through this scheme earlier, they’re still continuing to offer this scheme in the market. I am posting this message in the interest of general public to warn buyers about this ponzy scheme.
The way the scam works is like this. You will pay a down payment. You will then get a loan for the rest of the flat cost and give the loan money to Mantri as a lumpsum amount upfront. Mantri Developers will assure you that they will pay pre-emi for the loan till possession. They will also give you an agreement in a sheet of paper that they will pay the pre-emi.
In reality, Mantri developers will stop paying the pre-emi after few months. And since the loan is in your name, if you dont pay the pre-emi then your loan will default and your CIBIL score will decrease.
There are 100s of consumers who bought flats in Mantri’s projects in 2014-2015 time frame in the No-EMI offer scheme. Mantri developers has not paid 7 months pre-emi for all of them currently. Several people couldn’t bear the cash crunch and have defaulted on their EMI. Those buyers who defaulted have also received legal notice from the bank for the default. Their CIBIL score has gone for a loss.
Moreover the original agreement was that the builder will pay pre-emi till a certain possession date. Now the possession date for all webcity towers has been delayed by more than 2-3 years. Builder is not continuing the pre-emi for the delayed period and buyers are forced to pay pre-emi during the delayed period.
My advice to prospective buyers is to avoid buying flats in this scheme. The developer is exploiting the legal loopholes in our country to lure new buyers/customers to buy flats in this scheme. Would advice people to buy fully constructed flats that’s ready for registration and has proper OC instead of putting your hard earned money in such innovative schemes.