New Delhi, June 3 (UNI) National Housing Bank (NHB) and Helpage India today joined hands to provide counselling services for popularising the reverse mortgage loan schemes, which enables the elderly to borrow from banks against pledging their residential property.
''We have tied up with 12 banks like Punjab National Bank, State Bank of India and Oriental Bank of Commerce to provide reverse mortgage loans, while Helpage India will provide the counselling in its centres in eight cities,'' NHB CMD S Sridhar told reporters here.
The scheme announced by Finance Minister P Chidambaram in last year's budget is yet to pick up steam and it is expected that the new partnership between Helpage India and NHB will go some way in creating awareness about the benefits that it will endow to senior citizens.
Reverse mortgage is a loan scheme in which senior citizens can use their property as a source of income.
A senior citizen who owns a house can obtain a reverse mortgage and the bank to which he pledges his property either pays him a lumpsum amount or a regular income.
The money provided by banks as regular income to the owner carries an interest rate, which is around 10-11 per cent. After the death of the property owner, the heirs of the property can repay the loan and claim the property or the bank can sell the property to recover its dues and pay the balance to the legal heirs of the property owner.
''The cap has been fixed to a maximum of Rs 50,000 annually or 50 per cent of the value of the property in lumpsum,'' Mr Sridhar said.
He said the main roadblock to the scheme's popularity was the income tax rider, which has been clarified. ''The payment received from the Bank was taken as income, which is not the case. This has been clarified and the government will notify this soon,'' he said.
Mr Sridhar expects 12-14 per cent of the elderly population to benefit from this scheme.
UNI SR SG NS1718