New Delhi: Housing finance regulator National Housing Bank (NHB) on 31 May 2007 relaxed the age restriction for availing loan facility by senior citizens under the Reserve Mortgage Loan (RML) scheme.
“The restriction on married couples being eligible as joint borrowers provided both are above the age of 60 years, has been relaxed so as to include those couples also wherein one of the borrowers is below the age of 60,” NHB said.
NHB has modified its operational guidelines for RML after receiving feedback from stakeholders on the draft guidelines.
According to the final norms, borrowers will not be required to pay any penalty toward prepayment of loans.
In order to balance risk perception and other requirements of lenders, the modified norms stipulate that RMLs will be restricted to self-acquired and self-occupied residential properties, owned by senior citizens, having a residual life of at least 20 years.
NHB also advised lending institutions to remain selective in giving loans against property and frame their internal policy guidelines for eligibility and end-use norms. However, terms and conditions must be fully disclosed to the potential borrowers upfront, an NHB press release said.
The reverse mortgage guidelines allow senior citizens to have a steady stream of income by mortgaging self-occupied property to banks or other eligible financial institutions.
Punjab National Bank has already launched the reverse mortgage scheme after obtaining approval of NHB.