What do people benefit from?

Banking and finance expert Nguyen Tri Hieu said that current laws stipulate that future housing projects must have a bank guarantee before they can be sold, in order to protect buyers from investors drawing up virtual projects and implementing projects behind schedule.

However, although there have been regulations on guarantees since 2015, up to now, there are no official statistics showing how many projects have been guaranteed by banks and how many customers have had their rights protected...

Therefore, Mr. Hieu proposed to tighten regulations to force investors to fulfill their obligations. Homebuyers must have a bank guarantee certificate in hand to ensure all rights when buying future housing.

Regulations on guaranteeing future housing: What benefits do people get? - 1 — Regulations on guarantees for future housing projects act as a "shield" to protect buyers.

Many lawyers also believe that, despite this guarantee provision, in reality, people encounter many investors who are late in handing over their houses, despite complaints, lawsuits, and calls for help everywhere. Therefore, it is necessary to understand the purpose of the provision on guarantees for future housing. Specifically, this provision of the law aims to protect the rights of home buyers - those who are disadvantaged in real estate transactions when they have little understanding of the purchase and sale procedures, have little information about the project, and are not qualified to grasp, monitor, and manage the project during the implementation process.

Meanwhile, the bank is a reputable entity, capable of managing and monitoring the health of the business from finance, cash flow, revenue, progress... The bank is fully capable of guaranteeing for home buyers.

Lawyer Nguyen Ngoc Hung, Head of Ket Noi Law Office, proposed that there should be a compensation regulation for late handover, including: late handover fines, rental fees during the late handover period, or some other compensation regulations to support people.

It is even necessary to extend the guarantee period until the land use right certificate is handed over to the people; requiring the investor to have assets and a blocked amount of money to guarantee this obligation.

Besides, many opinions are also concerned that this regulation will cause more problems for buyers.

Mr. Le Hoang Chau - Chairman of Ho Chi Minh City Real Estate Association (HoREA), analyzed that the guarantee regulations in the sale and lease-purchase of future housing increase the housing prices that home buyers have to bear.

The investor must pay a “bank guarantee fee” which is usually about 2% of the total value of the guaranteed property. This is a very valuable commercial housing project, so the “guarantee fee” is also very high. The bank guarantee fee is paid in advance by the investor to the bank but is included in the cost price, increasing the selling price of the house, which the home buyer must ultimately bear.

Second, according to the Chairman of HoREA, the “signs” of the guarantee regulations in the sale and lease-purchase of future housing almost only “benefit” commercial banks. Because most of the commercial banks that provide “guarantees” are the same banks that have lent credit to investors to invest in construction and development of that project and have mortgaged that project to secure the loan…

Circular 11/2022 of the State Bank of Vietnam regulating bank guarantees takes effect from April 1, 2023, including regulations on guarantees for future housing.
The Circular stipulates that after signing the sales contract, the investor must send this contract to the commercial bank to request the issuance of a letter of guarantee for the buyer.
A commercial bank is qualified to guarantee future housing (also known as paper housing) when its establishment and operation license or its amendment or supplement to the establishment and operation license of the commercial bank stipulates the content of bank guarantee activities and is not prohibited, restricted, suspended, or temporarily suspended from guaranteeing future housing.

Ngoc Vy

Useful
Emotion
Creative
Unique
Wrath