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Reverse Mortgage Loan - "PNB Baghban"

for Senior Citizens


PNB is the first Public Sector Bank to come out with a Reverse Mortgage concept
based product for senior citizen titled "PNB Baghban". The product addresses one of
the very important requirements of the society in the fast changing culture of Indian
society. The salient features of the productare given hereunder:
Objective
To address the financial needs of senior citizens owning self occupied property (house)
by generating income / supplementing pension / other income, for their day to day
requirement
Eligibility
The residential house/flat owner, who is resident of India, of the age of 60 years &
above, is eligible to raise the loan under this Scheme.
Qualifying/ Maximum amount of loan/ Margin
The qualifying amount of loan will depend on the realisable value of residential property,
after maintaining margin of 20%. The maximum qualifying amount of loan, alongwith
interest, shall be restricted to Rs.100 lac. (alongwith interest) and to be paid monthly on
reverse annuity basis.
Rate of interest

Click Here to view rate of interest


Diabursement/ tenor of loan
The loan shall be extended as regular fixed monthly payments during the loan period.
i.e. 10-20 years or till the death of the last surviving spouse, whichever is earlier.
Depending on the age of the beneficiary, a chart containing the amount of monthly
instalments (calculated on "Reverse Annuity basis) to be paid to the senior citizen
borrower for different tenors of loan per lac of rupees is as under :Tenor (yrs)
Monthly Installment (Rs.)

10 11 12 13 14 15 16 17 18 19 20
420 350 300 250 220 190 160 140 120 100 90

Payment of lump sum amount, with a maximum of Rs.15 lacs, under the scheme can
also be considered selectively on merit, for meeting medical exigencies of senior citizen

borrower and his/her spouse & dependents.


Repayment

Loan to be recovered only after the death of both the spouses and no loan repayment
during the lifetime of borrower.
Settlement of loan, along with accumulated interest, to be met by the proceeds received
out of sale of residential property and any surplus to be paid to heirs. The loan will, as
such, become due for recovery and payable six months after death of the last surviving
spouse. However the legal heirs/legatee of the deceased borrowers will be given first
option to settle the loan, alongwith the accumulated interest, without sale of the
property.
Pre-payment of Loan
The option to pre-pay the loan at any time during the currency of loan or later, is
available. However, in case there is any takeover of loan by other financial institution/
bank, a charge of 2% on the amount taken over, will be levied.
Upfront Fee
Amount equivalent to half month's loan instalment subject to Maximum of Rs.15,000/- +
Service Tax & Education Cess
Documentation/ Inspection Charges
NIL
Right of Rescission
After the loan is sanctioned senior citizen borrower(s) shall be given upto 10 days time
to relook into his requirements and if he so wishes to cancel the transaction for any
reason whatsoever.

Canara Jeevan
REVERSE MORTGAGE LOAN (RML) SCHEME FOR SENIOR CITIZENS
In the present scenario, for most senior citizens and those nearing retirement the biggest fear is the need for money to

live comfortably after retirement. Reverse mortgage loan scheme helps them to convert their dwelling house property
into liquid cash flows to meet their living expenses.

With this objective of meeting the financial needs of the Senior Citizens, a new loan scheme is introduced, namely
CANARA JEEVAN - Reverse Mortgage Loan Scheme For Senior Citizens.
Objective:

To meet the financial needs of Senior Citizens owning self occupied residential property.

Purpose of the loan:

For supplementing pension/other income

Maintenance of family, Medical, emergency expenditure

Repayment of an existing loan taken for the residential property to be mortgaged

Up gradation, renovation and extension of residential property

For uses associated with home improvement, maintenance/insurance of residential property

Meeting any other genuine need

Eligibility

Owners of residential house/flat, who are residents of India, above 60 years of age,

Property self acquired and self occupied as permanent primary residence and property free from encumbrance

Residual life of property should be at least 20 year

Incase of flats the age of the flat should not be more than 10 year.

Couples will be eligible as joint borrowers and in such cases, at least one of them should be above 60 years of

age and the spouse/joint borrower should be more than 55 years of age.

In case of jointly owned properties the joint owner who is aged above 60 years shall be the first borrower.

Commercial property not eligible under the scheme.

No loans against ancestral property.

Determination of Eligible Amount of Loan:

Depending upon the age of the borrower and the assessed value of the property. flats/house.

Incase of independent house Minimum loan quantum Rs.5.00 lacs and maximum Rs.50.00 lacs. (*)

Incase of flats Minimum loan quantum Rs.5.00 lacs and maximum Rs.25.00 lacs. (*)

(*) Loan amount including interest till maturity.


Nature of Payment:
Nature of payment to be decided in advance as part of the RML covenants, as under:

Periodic payments (monthly/quarterly)

Option once exercised for monthly or quarterly payments shall remain unchanged throughout the tenor of the loan
and interchangeability cannot be permitted.

One time Lump-sum payment, not more than 20 % of the eligible loan amount.

In case of periodic disbursement, the payments shall be made during the loan period of 15 years or till the death
of the last surviving spouse, whichever is earlier.

Period of Loan: Maximum 15 years.


Rate of Interest: Please visit our interest rate page for current rates.

Security:

The loan shall be secured by way of mortgage of residential property, by way of Registered Mortgage or equitable
mortgage with memorandum of deposit of title deeds in favour of the bank.

Repayment of the loan:

The loan shall become due and payable only when the last surviving borrower dies or would like to sell the house,
or permanently moves out of the house.

Processing charges:

0.25 % of the loan amount with a maximum of Rs. 5000/-

UNION BANKOF INDIA

PURPOSE
To provide a source of regular income for senior
citizens in the form of monthly payout or
combination of monthly payout and lump sum
(available for medical purpose only) amount.
ELIGIBILITY

Indian citizen above 60 years.

Owns self-acquired and self-occupied


residential property in India

Individual, either singly or jointly with


spouse, in case of a living spouse older
than 55 years, as co-applicant; number of
surviving spouses on the date of sanction
should not be more than one.

RESIDENTIAL PROPERTY

The property against which the borrower


proposes to raise the loan should be his/her
permanent primary residence.

The property should be self-acquired and


self owned.

Borrower(s) will be required to inform the


bank when they cease to use the residence
as their permanent residence.

QUANTUM OF LOAN

Minimum Rs. 1 Lakh inclusive of interest

Maximum up to Rs. 100 Lakhs inclusive of


interest subject to max 90% of the market
value of the property depending on location.

MARGIN
Metro
Urban
Other areas

10%
20%
30%

TENURE OF

LOAN

Minimum tenure of 15 years and maximum


tenure of up to 20 years, if the borrower's
age is between 60 and 65.

Minimum tenure of 10 years and maximum


tenure of 20 years, if the borrower's age is
above 65..

RATE OF INTEREST AND PROCESSING


CHARGES

Please click here to know our latest rate of


interest

0.50% of loan amount subject to a


maximum of Rs. 10000 plus service tax as
applicable

PREPAYMENT PENALTY

There is NO prepayment penalty if the loan


is adjusted by the borrower from his own
verifiable legitimate sources

A penalty of 2% on the average balance of


the preceding 12 months, if the loan is
taken over by any other Bank /FI or
adjusted by the borrower in lumpsum from
any third source/party (except genuine
sale).

SECURITY

Equitable mortgage (E.M.) of the


residential/ commercial property, which is in
the name of the borrower and/ or his family
members. The co-owners of the property
need to join in as co-borrowers

INSURANCE

Property insurance is compulsory to the


tune of the value of the property

Calculator

`
Features

Forms & Documents

FAQs

PURPOSE
To provide a source of regular income for senior
citizens in the form of monthly payout or combination of
monthly payout and lump sum (available for medical
purpose only) amount.
ELIGIBILITY

Indian citizen above 60 years.

Owns self-acquired and self-occupied residential


property in India

Individual, either singly or jointly with spouse, in


case of a living spouse older than 55 years, as
co-applicant; number of surviving spouses on the
date of sanction should not be more than one.

RESIDENTIAL PROPERTY

The property against which the borrower


proposes to raise the loan should be his/her
permanent primary residence.

The property should be self-acquired and self


owned.

Borrower(s) will be required to inform the bank


when they cease to use the residence as their
permanent residence.

QUANTUM OF LOAN

Minimum Rs. 1 Lakh inclusive of interest

Maximum up to Rs. 100 Lakhs inclusive of


interest subject to max 90% of the market value
of the property depending on location.

MARGIN
Metro
Urban
Other areas

10%
20%
30%

TENURE OF LOAN

Minimum tenure of 15 years and maximum


tenure of up to 20 years, if the borrower's age is
between 60 and 65.

Minimum tenure of 10 years and maximum


tenure of 20 years, if the borrower's age is above
65..

RATE OF INTEREST AND PROCESSING CHARGES

Please click here to know our latest rate of


interest

0.50% of loan amount subject to a maximum of


Rs. 10000 plus service tax as applicable

PREPAYMENT PENALTY

There is NO prepayment penalty if the loan is


adjusted by the borrower from his own verifiable

legitimate sources
A penalty of 2% on the average balance of the
preceding 12 months, if the loan is taken over by
any other Bank /FI or adjusted by the borrower in
lumpsum from any third source/party (except
genuine sale).

SECURITY
Equitable mortgage (E.M.) of the residential/
commercial property, which is in the name of the
borrower and/ or his family members. The coowners of the property need to join in as coborrowers

INSURANCE
Property insurance is compulsory to the tune of
the value of the property

*Conditions apply. For further details, please visit our


nearest branch.
LIST OF DOCUMENTS

Proof of identity (any of the following)


a. Passport
b. PAN Card
c. Employee identity card

d. Any other valid proof

Proof of address (any of the following)


a. Electricity bill
b. Telephone bill
c. Ration card
d. Any other valid proof

PAN Card

Property papers
a. Proof of ownership
b. Title Deed

3 photographs

Any other document required as per the


application form

APPLICATION FORM
To download the application form, please click here

What is the maximum loan amount?


The maximum amount of loan sanctioned would be minimum
of A or B
A. 90% in metro, 80% in urban and 70% in other areas of
the market value of the residential property.
B. Rs 100 Lakhs.

Who can be the co-applicants for the loan?

You can avail loan either singly or jointly with spouse, in case
of a living spouse older than 55 years, as co-applicants; number
of surviving spouses on the date of sanction should not be more
than one. In case there are any other co-owners of the house/
flat, they also need to be co-applicants.

What are the loan tenure options?

The repayment period is minimum of 15 years and maximum


of 20 years if the borrower is aged between 60 and 65. For
borrower above 65 years of age, minimum repayment tenure is
10 years and maximum of 20 years.

What are the applicable rates of interest?

Please click here for information on rate of interest.

What are the processing charges?

One time upfront fee of 0.50 % of the loan amount, subject to a


maximum of Rs 10,000 plus
service tax.

What security/ collateral do I have to provide?

The security to be provided is the Equitable Mortgage (EM) of


the residential property, proposed to be purchased from Bank's
finance, is required.

Do I need to open an account with Union Bank of India for


availing and/ or servicing the loan?

Yes, opening of account with Union Bank of India is


mandatory.

What documents do I need to submit to avail a reverse


mortgage loan?

Please see the Forms & Documents Tab above for information
on the list of documents required.

How much time will it take for my loan to be approved?

It takes 7 days for your loan to be sanctioned, after you have


submitted all the required documents.

What are the stages involved in taking a loan?


There are three main stages -

Application - Whereby you submit a completely filled


in application with all necessary documents

Sanction - Whereby you get an approval for a specific


loan amount based on the value of your property and
repayment capabilities

Disbursement - Whereby the loan amount is disbursed

How do I approach Union Bank of India for a reverse


mortgage loan?
You can approach us in any of the following ways

You can visit any of our special retail lending branches


called Union Loan Points (ULPs). To locate a ULP,
click here

You can visit any of our branches. To locate a branch,


click here

Request for a contact online

Baroda Ashray (Reverse Mortgage Loan)


Interest Rate: Base+1.75%
Purpose:
For supplementing the cash flow stream of senior citizens in order to address their financial needs.

Eligibility:

Should be Senior Citizen of India, above 60 years of age.

Married couples will be eligible as joint borrowers provided one of them is above 60 years of age
and age of spouse is not below 55 years at the time of application.

Should be the owner of a residential property (house or flat) located in India in his/her own name.

Residential property should be used as permanent primary residence (fully self occupied property).
The Commercial property will not be taken as a security under the product.

Maximum Amount:
The maximum loan amount inclusive of interest for entire tenure of the loan shall be restricted to Rs. 1
crore subject to value of the property.

Option to adjust payments:


The Bank shall have the option to revise periodic annuity amount, if lump-sum payment is taken or at the
interval of every 5 years based on valuation of the property.

Repayment of Loan:
The loan shall become due and payable when the last surviving borrower dies or would like to sell the
home / permanently moves out of the home for aged care to an institution or relatives. The loan will, as
such, become due for recovery and payable.

Settlement of loan, along with accumulated interest, to be met by the proceeds received out of
sale of residential property.

The borrower(s) or his/her/their estate shall be provided with the first right to settle the loan along
with accumulated interest, without sale of property. A reasonable period of 2 months may be
provided when repayment is triggered, for house to be sold.

Rate of interest:
( CLICK HERE FOR CURRENT INTEREST RATES )

Security:
Simple / Equitable mortgage of the Residential property.

Tenure:
15 years. The tenure may further be extended till survival of the borrower/s subject to advance value of
the property.

Insurance:

Insurance of the residential property mortgaged to the bank shall be regularly taken. The premium
charges are to be borne by borrower.

State Bank of Mysore


Highlights of Reverse Mortgage Scheme
Objective
Eligibility

To provide a source of additional income for senior citizens who


own self acquired House property in India
a

No. of borrowers

Single or jointly with spouse in case


of living spouse

Age of the first


borrower

No. of surviving
Should not be more than one.
spouses on the date Borrowers will have to give an
of sanction of loan
undertaking that they will not remarry
during the currency of the loan. If the
borrower chooses to remarry, the
loan will be foreclosed.

Age of the spouse

Above 58 years

Residence

Borrower should be staying at SELF


ACQUIRED and SELF OWNED
house/flat against which loan is being
raised, as his permanent primary
residence.Proof of residence has to
be provided. Affidavit made before
the Executive Magistrate may also be
accepted as proof of residence.
Borrowers will be required to inform
the Bank when they cease to use this
residence as their permanent
residence.

Title of the Property

Borrowers should have clear and


transferable title in their names. The
title verification and search report for
a period of 30 years will be required
to be obtained from the Banks
empanelled advocate at borrowers
cost.

Title of the property


and number of
borrowers

If the property is in single name and


the loan is availed jointly with spouse,
the borrower should make a

Above 60 years

Registered Will in favour of the


spouse. The Will should confirm that
this is the last Will and that it super
cedes all earlier Wills, if any. The
borrower to undertake that no fresh
Will shall be made during the
currency of the loan.
h

Encumbrances

The property should be free from any


encumbrances. In case the borrower
has availed Housing loan from SBM
and the property is mortgaged to
SBM, the loan under Reverse
Mortgage will be considered subject
to closure of housing loan from the
proceeds of the Reverse Mortgage.

Residual life of
property

Should be at least 20 years in case of


single borrower and 25 years in case
of spouse below the age of 60.

Security

The loan will be secured by way of Equitable Mortgage of


residential property.

Period

Age of the younger borrower


Between 58-68 years ---------------15 years
Above 68 years----------------------10 years
OR till death of the borrower(s) whichever is earlier.

Disbursement

Directly to the joint account of the borrowers with E or S clause.

Periodicity of
availing loan

1. Monthly/quarterly payment
2. Lump sum payment.

Quantum of loan The loan amount would be 90% of the value of property. Loan
amount would include interest till maturity. The loan installment
payable to the borrower(s) would be as under (for a loan amount of
Rs.1 lac) (interest calculated at 10.75% p.a.)
Loan Tenor

10 yrs 11yrs

12yrs 13yrs 14yrs 15yrs

Monthly
installments

468

399

343

297

258

225

Quarterly
installments

1423

1215

1045

905

787

687

Lumsum
payment

34294 30813

27686 24876 22351 20083

Qualifying loan amount (90% of property value) Rs.9 lacs


Tenor----------------15 years
Monthly installment Rs.225 X 9 = Rs.2025
Quarterly installment Rs.687 X 9 = Rs.6183
Quantum of monthly installment/quarterly installment will change
whenever there is change in the rate of interest.
Maximum Rs.1 crores
Loan amount
Minimum Rs.3 lacs
Purpose of loan

Supplementing income, any personal expenses, house repairs etc.


Loan amount should not be used for speculative, trading and
business purpose.

Rate of interest
(fixed)

Public: 2.5% below SBMPLR present rate will be 10.75%


Retired Staff: 3% below SBMPLR present rate will be 10.25%
Interest rate to be reset every 5 years.

Repayment /
settlement

The loan shall be liable for foreclosure due to occurrence of the


following (events of default).
If the borrower(s) has/have not stayed in the property for a
continuous period of one year.
If the borrower(s) fail(s) to pay property taxes or maintain and
repair the residential property or fail(s) to keep the home insured,
the(Bank reserves the right to insist on repayment of loan by
bringing the residential property to sale and utilizing the sale
proceeds to meet the outstanding balance of principal and
interest.)
If borrower(s) declare himself/herself/themselves bankrupt.
If the residential property so mortgaged to the Bank is donated or
abandoned by the borrower(s).
If the borrower(s) effect changes in the residential property that
affect the security of the loan for the lender. For e.g., renting out
part or all the house by creating a tenancy right, adding a new
owner to the houses title; changing the houses zoning
classification; or creating further encumbrance on the property
either by way of taking a new debt against the residential property
or alienating the interest by way of a gift or Will.
Due to perpetration of fraud or misrepresentation by the
borrower(s).
If the Government under statutory provisions, seeks to acquire
the residential property for public use.
Any other event such as re-marriage of the borrower(s) etc which
shall have an adverse impact on the loan settlement prospects.
Borrowers do not accept the revised terms on revaluation of
property and interest rates at the end of every 5 years from date of

sanction.
Any violation of the terms and conditions of Reverse Mortgage
loan.
Pre closure of
loan

The borrower(s) will have option to repay the loan at any time
during the loan tenor.
There will be no pre closure penalty.

Valuation /
revaluation of
property and
option for the
Bank to adjust
payments.

After the initial valuation to determine the loan amount,


subsequent revaluations should be done at intervals of 5 years.
The Bank shall have the option to revise the periodic amount
every 5 years along with revaluation. In the scenario of fall in
property prices, the Bank will revise the amount at any time earlier
than 5 years. At every stage of revision, it should be ensured that
the Loan to Value ratio does not exceed 90% at maturity.
If the borrower does not accept the revised terms, no further
payments will be effected by the Bank. Interest at the agreed rate
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 in clauses 11 and 12.

Processing fee

0.50% of the loan amount, maximum of Rs.10, 000.

Right of
rescission

As a customer friendly gesture and in keeping with international


best practices, after the documents have been executed and loan
transactions finalized, borrowers will have the right to rescission
within SEVEN days to cancel the transaction. If the loan amount
has been disbursed, the entire loan amount will need to be repaid
by the borrower within this period. However, interest for the period
would be waived. Processing fee shall not be refunded.

Insurance and
maintenance of
house property

The house property will be insured by the borrower at his cost


against fire, earthquake and other calamities.
The borrower shall ensure to pay all taxes, charges etc.
Bank reserves the right to pay insurance premium, taxes,
charges etc. by reducing the loan amount to that extent.
The borrower shall maintain the property in good condition.

Type of facility

Non renewable overdraft without any ledger folio charges. No


cheque book/debit card will be linked to this account.

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