[Please read the note with open mind and bear with the grammatical mistakes here and there! The objective of this note is to keep you aware of strategy adopted DLF or any other opportunist builders and not to create content for international journal.]
I have booked my apartment in DLF city( on their very first project) in 2009 July . That was the time when DLF was running under the trouble with land mutation issues.
I had been consulted by my long term financial consultant to book the property as DLF being a mighty builder, they would definitely get out of their problems. I went to their office( old office which was located close to Passport office off MG Road) . The marketing team was so impeccably rational, I found them very impressive. What stood apart from other marketing team was their conviction, they were not using too many flattering words and/or rightly highlighted the discussed the and plans to address those issues . I liked that approach . Which was neither over flattering, nor arrogant but filled with the right balance between rationale and courteousness .
Following the booking, I was very highly impressed with their operations. The invoice process was so amazingly managed until 2012 . First they operation team would float a heads up message, following the bank investigation would come the demand notice with a 30 days of payment window.
Within 2 days of payment I would receive the acknowledgement over email and via snailmail .
Then arrived 2012 May . And I received a letter from DLF. Due to the external events in Indian real estate market the progress of the completion would be delayed and the delivery would take 18 more months.
Please note, all 9 payment milestones were executed as per the payment milestone plan by 2012 Feb .The only one pending was the final one related to registration and possession.
What DLF has done, they met the milestones criteria for the project completion until roof top, else Banks would not release the home-loan money for their customers . I was in touch with HDFC( my financier) auditor . They were not very happy with DLF but had confirmed that DLF was legally correct in meeting the deadlines for the payment milestones. DLF collected the money from the customers until "roof top" payment milestone and then kept the project on hibernation for more than 2 years .
By early 2012 all the good workers from accounts and customer service team were replaced . I remember receiving great services from Sumathi Christy, Madhu Khare until 2012. They were immensely supportive and could resolve any difficult queries involving payment history analysis and forecasting etc over phone . All of the good staffs have been replaced with less capable operational resources or in some cases no resources. Overall customer service processes has been redesigned to bring focus only towards the sales to milestone delivery( please not again, DLF ensures positive bank audits before payment milestones) .
The problem with Indian bank audit is, there is no compliance criteria on the overall project completion. Bank just checks if a builder has really completed roof-tops when it is sending demand letters for the roof-top payment-milestone. Bank does not check any schedule variance for the delivery milestones. As per Indian rule, a house loan is issued for a project plan not more than 3 years. DLF ensures they pass all the delivery milestones audits within 2.5 years.
Thus DLF accumulates the maximum corpus from the customers and then keep the project in hold state! A new customer will find any trouble with DLF delivery process only in 2.5 years since the booking . They reuse the money somewhere else.
The general manager of DLF Bangalore behaviour to the existing customers can be best described as a'rogue'. He comfortably howls at the existing customers and the new customers generally don't approach him.
Finally, you can imagine how you will feel when you have completed 90% of your payment and then you wait for 2+ years before you move in .
A friend of mine who booked in another project in Delhi in 2008 received registration letter in August 2013. A building project has to be of 3 years duration at the maximum . The same pattern followed there too!
Conclusion:
DLF strategy is, recover 90% of the corpus from customers following the compliance guideline in India within 2.5 years. Then delay the project for another 2 years as no Indian rule can touch them anymore. Customers may face a challenge if they have to finance the last milestone( registration and possession) with the help of the bank, the bank may say they will convert the loan to commercial one with higher rate of interest.
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