Understanding the Profile Funding Scam in Indian Real Estate

Owning a home is a big dream for many Indian families. However, some builders use a dishonest trick called Profile Funding Scam in India to trap buyers in debt. This growing real estate fraud is affecting many middle-class families who are unaware of how this scheme actually works.

Profile Funding Scam in India

What is Profile Funding?

Profile funding is a setup where a builder offers to pay the buyer’s down payment to help them get a home loan. It looks like a way to buy a house with “zero investment,” but it is actually a trap. This method is commonly known as the Profile Funding Scam in Indian, and it is designed to mislead homebuyers.

Usually, banks ask for 5%–10% of the property cost as a down payment. Builders target people who don’t have this cash and promise:

• No upfront payment from the buyer.
• The builder will arrange the down payment.
• The builder will pay the monthly EMIs until the house is finished.

These promises make the deal look attractive and risk-free, but in reality, it is part of a carefully planned real estate loan fraud.

How the Trap Works

The Profile Funding Scam in India usually happens in these steps:

• The buyer applies for a home loan in their own name.
• The builder pays the small 5% down payment to the bank.
• The bank then gives 80%–85% of the total loan money directly to the builder.
• The builder pays the first few EMIs to make the buyer feel safe.

After a few months, the builder stops paying.

Because the loan is legally in the buyer’s name, the bank goes after the buyer for the money—not the builder. The buyer ends up with huge debt and a ruined credit score, while the builder already has the loan money. This is why the Profile Funding Scam in India is considered one of the most dangerous real estate fraud schemes.

Breaking the Rules

Normally, banks should only release money as the building is being constructed. This is called the Construction Linked Payment Plan (CLPP). In many Profile Funding Scam in India cases, banks often release the whole loan amount at once without properly checking whether the building is actually being constructed.

This violates standard banking procedures and increases financial risk for innocent homebuyers.

Legal Help for Victims of Profile Funding Scam in India

If you are a victim of the Profile Funding Scam in India, you can take legal action:

• RERA: File a complaint to get your money back.
• Consumer Court: Sue for unfair business practices.
• High Court: Ask for a stay order to stop the bank from collecting EMIs while the case is active.

Taking timely legal action can protect your financial future and prevent further damage to your credit profile.

Conclusion

The Profile Funding Scam in India is not a helping hand; it is a dangerous trap. Always do your research, verify the builder’s credibility, and be careful of offers that seem too good to be true. Awareness and legal knowledge are the strongest tools to protect yourself from real estate loan fraud in India.