Retail Credit

The Scheme will be operative through Designated Branches in Metro and Urban locations only

1. Age of the Applicant: Min. 60 years on the date of sanction
2. Married couples will be eligible as joint borrowers only and both of them should be of 60 years & above age.
3. Ownership of a residential property (house or flat) located in India, with clear title
4. Borrower(s) should be residing in the same residence at least for the last one year and the same be used as their ‘permanent primary residence’.
5. The property should be self occupied one, an approved construction, not older than 20 years, maintained in good condition and must be free from all encumbrances.
6. No Income Tax is due from the borrower(s).
7. No income proof is required.

Purpose of Loan

1. Supplementing pension/ other income.
2. Up gradation, Renovation and extension of Residential Property.
3. Uses associated with Home Improvement, Maintenance/ Insurance of Residential Property.
4. Medical and related emergency expenditures
5. Repayment of an existing loan taken for and against the residential property to be mortgaged.
6. Meeting any other genuine need.

1. Will depend upon the ‘‘Qualifying Amount’’ i.e. realizable value of the property minus margin.
2. ‘‘Qualifying Amount’’ shall be restricted to Rs. 50 lakhs.
3. Property will be revalued at an interval of every five years & the ‘‘Qualifying Amount’’ and thus loan amount shall be revised based on such revaluation of property.
4. The quantum of lumpsum payment (if any) and periodic payment shall be decided in such a manner so that the total lump sum payment and total periodic payment to the borrower together with the accrued interest and other charges in the loan account during the sanctioned tenor will not be more than the ‘‘Qualifying Amount’’ so arrived at after latest valuation of the property (realizable value of the property minus margin).

20% of the value of the property

1. Periodicity: The loan shall be disbursed as regular monthly or periodic cash advances and/or a lump sum payment (upon request). However, lump sum disbursal shall be restricted to end use of the fund. Further, lump sum disbursement should be restricted to loan amount calculated on 40% of the ‘‘Qualifying and thereafter period payment shall be fixed on the remaining 60% of the ‘‘Qualifying Amount’’.
2. Tenor: The tenor of disbursement shall be of 15 years or till the death of the last surviving borrower, whichever is earlier. 
3. Extension of the loan period:The Bank may consider extension of loan tenor for additional 5 years at its discretion depending on the market value of the property, its status, purpose of extension and approval from appropriate authority. 

Assessment of Lumpsum and Periodic Payment will be done on the basis of Realizable Value of Property, Loan Tenor, Prevailing Interest Rate and the conditions set for under the Scheme

The borrower(s) need not service the loan account. However, loan shall become due on the occurrence of any or more the following events:

1. When the last surviving borrower dies, sells the home, or permanently moves out of the home.
2. The borrower(s) having failed to pay property taxes or maintain and repair residential property or failed to keep the home insured.
3. Borrower(s) having declared himself/ herself/ themselves bankrupt.
4. If the residential property so mortgaged to the Bank is donated or abandoned by the borrower(s).
5. If the borrower(s) effect any changes in the residential property that affect the security of the loan for the Bank.
6. Perpetration of fraud or misrepresentation by the borrower(s).
7. If a government agency needs the residential property for public use (for example, to build a highway).
8. If a government agency condemns the residential property (for example, for health or safety reasons).
9. Where the market value (realizable value) of the residential property has declined below the applicable ‘Qualifying Amount’ of loan or outstanding balance in the loan account, whichever is higher, at any time during the currency of the loan.

NHB’s Guarantee will be available to the borrowers at his/her/their option as NHB’s assurance for continued periodic payment under the Scheme. Premium cost for the Guarantee shall have to borne by the borrower. The Guarantee will be available to the borrowers upon circulation of details by NHB.

The loan shall be secured by way of

1. Mortgage of owned & occupied residential property (English Mortgage)
2. “Registered Will” from the borrower in favour of Bank
3. An undertaking by the borrower that the “Registered Will” given to the Bank is the last ‘Will’ prepared by him/her at the time of availment of Reverse Mortgage Loan facility.

Commercial property will not be eligible for RML.

1. The residential property should comply with the local residential land-use and building bye-laws stipulated by local authorities, with duly approved lay-out and building plans.
2. The valuation of the property shall be done by an empanelled valuer of the Bank.
3. Such valuation of the residential property shall be at an interval of five years.

After the documents have been executed and loan transaction finalized, Senior Citizen borrowers may be given time up to three business days to cancel the transaction, the “option for rescission,”. If the loan amount has been disbursed, the entire loan amount will need to be repaid by the borrower within this three days’ period along with interest for the period. In this case, all cost and charges realized for extending the loan facility will not be refunded.

1. Bank will pay all loan proceeds directly to the borrower through his/her Savings account maintained in the name(s) of all the borrowers, except in cases stated in Para 3.b-3-f above and in cases pertaining to payments to contractor(s) for the repairs of borrower’s property, or payment of property taxes or hazard insurance premiums from the borrower’s account set aside for the purpose. In later cases, payment will be made directly to the party concerned through their Bank account/Demand Draft/Pay Order.
2. In case the residential property is already mortgaged to any other institution, Bank may permit use of part proceeds of RML to prepay/repay the existing housing loan. The loan amount will be paid directly to that Bank/FI to the extent of the loan outstanding with that institution or the limit as mentioned in 6.a above, whichever is lower, with a view to release the mortgage.
3. Periodicity: The loan will be extended as lump sum payment and regular monthly, quarterly, half-yearly or annual periodic cash advances.

1. Processing Fee, Documentation Charges, Inspection Charges etc.: As per Bank’s usual charges applicable for Housing Loan Scheme.
2. All other charges like Verification Charges of external firms, Search & Marketability Fees, Other legal Charges/ Fees, Stamp Duty and Registration Charges and Valuation charges etc are to be realized from the borrower on actual basis

Settlement of Loan

1. The loan shall become due and payable when the last surviving borrower dies or would like to sell the home, or permanently moves out of the home for aged care to an institution or to relatives or for any other reason whatsoever.
2. Settlement of loan along with accumulated interest is to be met by the proceeds received out of Sale of Residential Property.
3. The borrower(s) or his/her/their estate may be provided with the first right to settle the loan along with accumulated interest, without sale of property.
4. A reasonable amount of time, say up to 2 months may be provided when RML repayment is triggered, for house to be sold.
5. Branches are authorized for sale of house/property as per rules within three months from the death of borrower(s)/ permanent eviction of property by the borrower(s)/ occurrence of any of the events (as per Para 19 below) triggering closure of loan account.
6. The balance surplus (if any) remaining after settlement of the loan with accrued interest shall be passed on to the estate of the borrower.

1. The borrower(s) will have option to prepay the loan at any time during the loan tenor.
2. There shall not be any prepayment penalties.
3. However, where loan is taken over by other Bank/FI, a prepayment penalty @2.00% shall be levied.

The loan shall be liable for foreclosure due to occurrence one or many of the events stipulated under “Repayment of Loan” above.

1. Bank may revise the periodic/lump-sum amount at an interval of every five years based on revaluation of property
2. Borrower shall be provided with an option to accept such revised terms and conditions for furtherance of the loan.
3. If the Borrower does not accept the revised terms, no further payments will be effected. Interest at the rate agreed before the review will continue to accrue on the outstanding amount of the loan. The accumulated principal and interest shall become due and payable as mentioned hereinbefore.