Home loans at lower-than-market interest rates
Leading group-buying real estate portal Groffr.com has tied up with private sector banks to offer bulk consumers home loans that are 0.25-0.75% cheaper than prevailing interest rates.
“We have tied up with ICICI Bank and Indiabulls Home Loans, and a couple of Building Societies Associations (BSA) who generate bulk volume for banks. Negotiations are also on for IDBI Bank and Axis Bank. We are confident these two banks will give us mandate to generate bulk volume at rates that are a little cheaper than prevailing interest rates,” said Sandeep Reddy, Co-founder of Groffr.com.
The process is simple. Customers wanting to buy houses in metros or tier-II, III and IV cities have to log on to this website and submit their interest. Within 7-10 days, the company generates a large number of customers, which it uses to negotiate better interest rates and other terms with the banks.
Interestingly, within a fortnight of the launch, the company has registered over 500 interested customers.
Groffr.com also plans to a sign similar deal with India’s largest public sector bank the State Bank of India (SBI).
“We approached SBI earlier. But their response was unfavourable due to teaser home loan interest rates. Since teaser rates manage to attract large customers directly, the bank did not want any intermediaries like us. But, the teaser rate arena is over now. Hence, we will approach SBI once again for considering our proposal,” said Reddy.
The company is currently in talks with a few venture capital players to raise funds for expanding the firm’s operations. According to Vikhyat Srivastava, another Co-founder of the portal, a number of venture capital firms have evinced interest and, at present, a few investors of “Mumbai Angels” are in advanced talks with the company, he added.
The company plans to raise Rs 2-3 crore from venture capital investors.
The concept
All a buyer has to do is find a deal on the website he is interested in and get himself registered as an interested party in that deal. The property bears two prices: the market price and the discounted price Groffr.com offers, called the ‘Groffr Price’. The required number of group members and the last date for registering are also mentioned. Also, the buyers can suggest a deal in the ‘Start Your Group’ section, in which after starting a deal of their own choice, they can combine like-minded people to form a group. On forming a group, Groffr.com’s team steps in and negotiates the best deal with the developers on buyers’ behalf.
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