Loan fraudsters face Cibil crackdown

Mumbai: Fraudulent home loan seekers and habitual defaulters will have a tough time now as lenders have a ready pool of information available on them, with the launch of the country\’s first electronic centralised database of mortgage information called Cibil Mortgage Check.
Cibil Mortgage Check would help banks and financial institutions share and access mortgage information, exercise better due diligence, and thus help reduce fraudulent property transactions. This will also bring in more transparent and a factual mine of information about loan seekers, and more importantly about the property being sought to be mortgaged.
Cibil Mortgage Check, launched jointly by the country\’s largest credit information service provider Cibil (Credit Information Bureau of India) and TransUnion—a global leader in credit and information management services—in consultation with property market regulator National Housing Bank (NHB).
Launching this new tool here today, NHB chairman S Sridhar, who is also the CMD of Central Bank of India, said, \”Cibil Mortgage Check will help contain a lot of fraudulent activities in residential property marketplace that has been growing at a CAGR of 40 per cent since the past five years.\”
Sridhar further said, as the sectoral regulator, NHB has been working with Cibil to create this platform so that the lenders have access to ready and credible information on loan seekers as well as their properties.
Sridhar also informed that NHB is working on bringing out a property price index which will help contain excessive speculation in the marketplace.
On the proposed standards for residential property valuation, he said, NHB has already finalised a draft and sent it the Indian Bank Association for comments.
Launching the tool, Cibil managing director Arun Thukral said here today, \”lenders have been reporting rising cases of fraudulent transactions in housing sector. Realising the urgent requirement of an industry-wide system for fraud control, NHB advised us to develop an exhaustive repository of information on mortgages that will help contain defaults and fraudulent transactions by enabling informed decisions.
\”This solution will serve as a due diligence tool for credit granters before establishing business relationship with new customers,\” Thukral added.
This new service will help all sorts of lenders access ready information from Cibil and thus prevent fraudulent mortgage loan seekers from getting away.
Mortgage Check primarily offer two set of information-the personal information about the applicant, and secondly the complete chain of information about the property being sought to be mortgaged. It will also offer detailed reference database containing information on properties on which owners have already availed loans, and detail of those loans among others.
The second part assumes significance as the latest Reserve Bank report says the number of fraudulent activities such as fake and forged sales deeds, multiple copies of sales deeds, sale deeds of fictitious property and multiple financing in the home loan space, have witnessed a massive 75 per cent spike in the past five years.
Cibil has already got a data base of over 6 million and 25 lenders as members for the Mortgage Check tool. Cibil, which entered the country only in 2009, already sits over a data mine of 160 million and a customer base of 250 lenders.