Under debt, this clerk has postponed his marriage

Ranchi, June 23 : Sahid Parvez (37), a clerk in state-owned Central Coalfields Ltd, generally walks his way to office or when he feels rich rides an ageing two-wheeler. He lives in a cramped two-room house and borrows daily newspapers to keep himself abreast with the latest in the world. He may be just another Sunni Muslim, but what is striking about Parvez is his credit history as reflected in the files of LIC Housing Finance Ltd (LHFL) that lent Rs 2.90 lakh, facilitating the purchase of his dream home. But, now, he is in a debt trap, a feature not so uncommon among employed youths in Jharkhand today.

However, he is not ready to talk about it. When pressed, he says: “Despite being aware that taking or giving interest on debt is prohibited by Islam, I took a loan to buy a house of my own. It is only after I have landed myself in deep trouble that I realised the significance.”

Parvez had no ancestral property to fall back on. The responsibility of educating his younger brother, Sajid (24), a student in a private college offering diploma courses, was squarely on his shoulders after his mother and father G M Haider, a technical staff in Central Coalfields Ltd, passed away in 2001.

Parvez’s LHFL file (a copy of which is with The Indian Express) tells the story of a tier-2 or tier-3 city youth forced to postpone his own marriage, among other sacrifices, after his home loan tenure got extended, following a steady increase in interest rates.

Four years ago, he mobilised Rs 1 lakh from his savings and planned to build a house over 8,000 square feet by taking a Rs 2.90 lakh loan. With a tenure of 20 years and an EMI of Rs 2,340, LHFL projected that he would clear the loan in 2024, seven years before he retires in 2031. But the latest figure incorporated in the file indicates he will not be free from the debt before 2041 when he will be 70. “This is what nobody can dispute,” said LHFL’s agent Subhash Singh, who processed and got his loan application approved.

LHFL reviews the interest rate every three months (January, April, July and October), based on the prevailing market conditions. Parvez took the loan at a 7.5 per cent floating rate. Four years down the line, it had gone up to 10.75 per cent and the tenure of his loan was stretched to 2041.

Not once did he...

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