The Hindu 18.06.2010
HMDA all set to seal HUDCO deal
Staff Reporter
| To mortgage land for Rs. 700 crore assistance |
HUDCO charging 8.75 % interest while HMDA has earlier borrowed from others at 11.5 %
HMDA plans to clear its earlier loans from the assistance being provided by HUDCO
HYDERABAD: The Hyderabad Metropolitan Development Authority (HMDA) which has been assured of a financial assistance to the tune of Rs.700 crore by the Housing and Urban Development Corporation (HUDCO) these days is busy attending to the formalities for realising the amount.
For the amount, which could offer a much needed reprieve for a financially beleaguered HMDA facing some tough times after real estate boom took a nose dive, land mortgages are to be made. “We are in the process of identifying the land that could be offered as mortgage for the promised assistance,” an official said.
The sanction orders have already been received by the Authority from the HUDCO and the necessary formalities are expected to be attended to in the next fortnight. According to the official, the mortgage has to be of the value of 125 per cent of the amount being given.
Described as being provided on favourable terms, this assistance is being planned for using to clear the HMDA's earlier borrowings that were taken at a higher interest rate. While the HUDCO is charging 8.75 per cent, the past borrowing that are pending with the HMDA have come at an interest rate of 11.5 per cent. “A part of the past burden can be reduced with the fresh assistance and it will reduce the interest burden on us,” he said.
The HUDCO terms have been favourable in the sense that the payback period has been put at 15 years and it also offers a certain moratorium on repayment.
