Oct 05, 2012

Bank Negara should help borrowers who are facing bankruptcy due to abandoned housing developments, said the Malaysian Muslim Consumers Association (PPIM).

In a report by Bernama, Datuk Nadzim Johan, Executive Secretary at PPIM, revealed that their association has received about 100,000 complaints concerning mortgages.

"We found that the debtors still have to pay their home loans even when the developers failed to complete the housing projects. The problem is that the banks would not go after the developers, but will continue pressing the debtors," he added.

Nadzim reckoned that banks should be more vigilant when releasing loans to developers and should make sure that the projects are completed on time and according to phases, noting that in reality, "banks tend to release the loans without monitoring the projects."

As a result, "when the projects are abandoned, the developers will escape, while the consumers end up as victims."

While banks consider the issue as a civil case, PPIM considers this as a crime of fraud, as there are around 400,000 abandoned houses in the country, noted Nadzim.

"Hence, PPIM will organise a three-day forum to discuss and find solutions to the problem starting on 12 October at the Tun Dr Ismail Hall, Putra World Trade Centre. It is hoped that Bank Negara will participate in the forum to offer some explanation to the consumers," added Nadzim.

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