What risk does DHFL home loan buyers has based on current DHFL market conditions?

Question:

What risk does DHFL home loan buyers has based on current DHFL market conditions?

DHFL:

DHFL stands for Dewan Housing Finance Corporation. It is a housing finance company which extends loans to home buyers. Being a housing finance company, it has a special emphasis on affordable housing.

Answer and Explanation:

A home loan is a loan taken by an individual to finance the buying of a home. The home loan often comes with a longer period or a longer tenor compared to other loans.

Based on the current market conditions. home loan takers from DHFL may face a risk whereby the approved credit may not be disbursed as currently the company is facing a liquidity and solvency problem. With the loan not being disbursed, a home loan buyer may face further risk of having to refinance to buy a house.


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Investment Risks: Definition & Types

from Finance 305: Risk Management

Chapter 3 / Lesson 3
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