How To Restructure HDFC Loan, EMI, Credit Card Dues: Eligibility, Charges, Extra Tax

HDFC bank is the next in line to restructure their loan schemes and offer a moratorium of up to 2 years under the loan restructuring scheme.

Prior to this, it was the State Bank of India (SBI) who announced the restructuring of the loan framework for their personal loan borrowers. 

Both the banks’ loan restructuring schemes have been approved by the RBI.

What are the changes made by HDFC? Let’s find out!

HDFC Bank Restructures Loan For COVID-19 Affected Borrowers

As approved by the Reserve Bank of India, the HDFC Bank will be offering a moratorium of up to two years to retail borrowers. This moratorium will be offered as a part of the loan restructuring scheme. 

Those borrowers who have credit card loans or EMIs will be able to apply for one time loan restructuring option. If a customer is unable to pay their credit card installments due to the coronavirus pandemic they will be off a loan recast option. 

Who will be eligible for this restructuring? 

Any individuals or entities that are classified as standard and or not and effort for more than 30 days with the bank as of March 1 2020 are eligible for the restructuring. Also, they will have to remain standard across all the loans for facilities to date. 

Also, another basic criterion is that only the people who have been affected by the COVID-19 pandemic be eligible for this scheme by HDFC Bank. However, this will be verified by the bank, as in the bank will be reviewing the effect of the COVID-19 pandemic on the financial status of the customer.

The borrowers will also need to submit the necessary documents to the bank along with the application to avail of this restructured framework.

However, the customer’s viability to pay the restructured EMIs and the repayment track will be reviewed by the bank.

As per reports, the customer will also be given an option to restructure the entire credit card balance which also includes the loans within the credit limit. However, the amount will be converted into a separate loan account. 

They can also choose to restructure either one of the two, the card balance or the loan or both the facilities. The customers who have chosen the Jumbo Loan Facility will be permitted to restructure their loans too. 

There also is a minimum outstanding balance required. The minimum outstanding balance that HDFC Bank has mandated in order to convert the card or loan outstanding is Rs. 25000. 

How To Avail Restructured Loan Benefit?

To avail the benefits of the restructuring, you can visit the nearest branch of the HDFC Bank for details, or you can simply log in to the bank’s website, fill out the application form, and put in the details asked of you. 

Which documents will be required?

Documents that will verify the details about the current status of the customer’s employment or business.

1. Salaried customers will need to provide their salary slips and bank statements.
2. Self employed loan borrowers will be required to submit Bank statement, GST returns, Income tax returns, Udyam certificate, etc.

Will This Affect Credit Score?

The loan or credit facility will be reported to the credit bureau as “restructured”. In the regulatory guidelines issued by the HDFC Bank, “restructuring has to be reported at a borrower level to the credit bureaus and hence all the facilities or loans of the borrower with the bank will be classified and reported as “restructured” even if the borrower has taken restructuring for only one loan.” 

The guidelines also state that the bank will probably apply a fee if you choose to restructure the loan. Also, the option of restructuring is available for all the customers regardless of the moratorium applied status subject to the borrower meeting the regulatory guidelines.

Which Loans Will Not Be Eligible For Restructuring?

The following loans will not be available for restructuring:

1. Loans issued to individuals or entities for agricultural purposes and if these loans are classified as agricultural loans for the bank, they will not be eligible. 
2. Loans issued to Agricultural credit societies.
3. Loans issued to Financial service providers.
4. Loans issued to any central, state or local government bodies.
5. Loans taken by the employees of HDFC bank
6. Any exposures to housing finance companies which have already been rescheduled.