The real impact of these amendments, however, will depend on what happens after bankruptcy is invoked
The Union Cabinet recently cleared changes in the Insolvency and Bankruptcy Code (IBC) after which homebuyers will be treated at par with banks and institutional lenders.
It will enable them to pull defaulting builders to the Bankruptcy court as a participant in the resolution process. It may also lead to speedier claims settlement for homebuyers.
Until now, homebuyers of stuck realty projects could only file a claim in a Bankruptcy court.
In case a bankrupt company was sold out, homebuyers’ priority came after employee wages, banks and resolution costs. The changes in the law will accord higher primacy to home buyers’ interests.
Will the ordinance be enough to solve the problems of homebuyers, who have been distressed from defaulting builders?Watch the accompanying video to know more…