non performing assets meaning and

gmandhyan · Joined: 03 Jul 2007 Posts: 1 1.35 Dollars($)

non performing assets meaning and which company has the most of them?

miller_st · Joined: 17 Jan 2007 Posts: 917 168.84 Dollars($)

Hi Gmandhyan,

Non performing assets are also called as non performing loans. These are loans on which interest payments or repayments are not being made as per the schedule.

Banks treat there assets as non performing when they are not serviced for some period of time. When the payments are late for a short duration of time the loan is called as past due. But after payments are late for longer term (normally 90 days), the loan then is classified as being non performing.

Miller

blue · Posted: Tue Jul 03, 2007 12:11 pm Post subject:

Hi Gmandhyan,

Welcome to Mortgagefit discussion board.

Let me add few other points to what Miller mentioned about NPAs (Non Performing Assets).

It can be considered as sign of problem for a lender if there is high level of non performing assets as compared to similar lenders. But it should be looked at from the context of the type of lending which one does. It can be that a bank lends to higher risk customers than other banks & thus has a higher proportion of non performing debts. Such banks make up for this by charging higher interest rates & increasing spreads.

A mortgage lender is more likely to have lower NPAs compared to credit card provider but the latter may be making bigger profits on same assets by having higher spreads even if he has to write off the NPAs later on.

Do let me know if you have any other questions.

Thanks
Blue

larry · Joined: 27 Jun 2007 Posts: 3328 473.51 Dollars($)

Hi Gmandhyan,

Non-performing asset is an asset that do not produce the income effectively. Any amount to be received from such an asset remains due for more than 90 days. Overdue loan is a fine example of a non-performing asset.

Guest 0.10 Dollars($)

I just like to know if this are no longer performing then why is it the banks are still keeping this non perfoming assets if they can easily sell it up to investors?[/b]

jameshogg · Posted: Wed Nov 05, 2008 12:27 am Post subject:

Hi pinsdl!

In the recent times, prices are falling in the real estate market. Thus, the investors don't want to take any risk by purchasing a non-performing asset. Moreover it will not give them any additional profit.

Apart from this, the federal reserve has introduced various programs like bailout to help the banks. With this money, the banks are able to offer the debtors with loan modification programs so that they can save their property.

Thanks.

Guest 0.10 Dollars($)

If the payments is not made upto 90 days it becomes NPA.95th daysBanks
takes action under sarfeasi act13(2)-But the borrower pays the dues(emi)
on 97th days-Whether the Bank has right to take possession under sarfeasi
act just they intiated action under section 13(2)-By calling back the entire
loan is justifiable if all the EMI dues are paid pl reply my email "balavebss@gmail.com"

[Link deactivated as per forum rules. Thanks]

Guest 0.10 Dollars($)

According to SARFAESI ACT, the bank will have to send you and the guarantor a demand notice calling upon to discharge the dues in full within 60 days from the date of the notice. If within the 60 days, you pay off the debts, then the bank will not take away the property or call back the entire loan. If the borrower pays back the dues on the 97th day, then his property will be safe.

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