Ind Reverse mortgages loan is customized for such senior citizens who own a house /flat however have a requirement of quick financial help at lower interest rate of interest. Unlike traditional Indian bank mortgages loan, the reverse mortgage loan does not require monthly mortgage payments. The interest and fees on the mortgage are added to the loan balance each month. Over time, the home equity will decrease as the loan balance grows. It’s the reverse of a traditional mortgage.
The features and benefits of Ind Reverse mortgage loan are
- Maximum available loan amount is Rs.40 lakh.
- The amount of loan will depend on realizable value of the residential property as assessed by the Bank. The marketable value of the property is calculated at 10% less than the Market Value assessed by Bank’s Panel Engineers.
- The loan amount shall be disbursed by Bank on regular monthly which is often referred as annuity.
- For exceptional case of medical exigency, a lump sum of 20% of the net loan amount shall be disbursed. This would be however restricted to a maximum limit of Rs.15 lakhs.
- The margin shall be as 61% on the marketable value of property.
- Zero processing fee for Existing Indian Bank customer. For New to the bank customer the processing fee shall be charged @ 291/- per lakh.
- The maximum repayment tenure allowed is for 15 years with rollover facility. Rollover of the term shall be subject to bank’s discretion and revaluation of the property.
- Applicants have to provide the upfront consent for the revision of monthly payment which could be altered basis the revaluation of property. Revaluation of property will be done once in 3 years and interest rate will be reset once in 5 years.
- The loan amount need not be repaid during the lifetime of the borrower / spouse. The borrower / spouse can continue to stay in their home during their lifetime.
- Nil pre-payment charge for any foreclosure of the loan.
Rate of interest
10.45% .The Reverse Mortgage Loan interest rate shall be subject to reset clause – Interest reset at the end of every 5 years based on the then prevailing Reverse Mortgage Interest on the date of reset.
- Senior Citizens above 60 years, including retired staff of Indian Bank.
- Married couples will be eligible as joint borrowers for financial assistance provided one of them is above 60 years of age.
- Applicant should be owner of self-acquired residential property with absolute, clear title / conveyance and self-occupied and it should be principal residential house / flat, located in India.
- The property should be free from encumbrance and is saleable and the house / flat to be located in India.
- For cases of inherited residential property if it is devolved on partition or owing to being the sole legal heir also can be accepted provided the title of the property is free from encumbrance.
- The residual life of the property should be more than 20 years.
- Completed Application Form with passport size photograph.
- PAN Card copy.
- Proof of residence such as Recent Telephone Bill / Electricity Bill / Property Tax Receipt / Passport / Voter’s ID.
- List of legal heirs with name, age, address etc.
- Sale Deed.
- Approved Building Plan.
- Title Deed Documents for 30 years.
- Proof of title in the Revenue Records. (Legal Opinion from Advocate & Valuation of property from Engineer will be arranged by Bank at applicant’s cost).
Security / collateral
The acceptable security towards loan against property in Indian bank is the Security Equitable Mortgage of Property. Registration of the equitable mortgage is mandatory for states where the provision of the same implies. The cost towards registration shall be borne by the customers. Customers should ensure the property they have proposed to buy should be free from any litigation or impediment. The ownership structure should be clear and no previous loan has been obtained on the same property from any lender. The construction should be insured up to the full market value under general insurance for any untoward event such as fire, flood, cyclone, Typhoon, Lightning, explosion, riot, Earthquake risks etc.