Date:14/04/2007 URL: http://www.thehindubusinessline.com/2007/04/14/stories/2007041401190800.htm

Back Reverse mortgage

The news that senior citizens can earn some regular income by opting for reverse mortgage on their house property will be welcome by many middle-class senior citizens who might have built houses to live in but do not get much of a pension to live on.

According to the recent announcement by the National Housing Bank (NHB), senior citizens may mortgage their residential property to a bank or a housing finance company while retaining the right to stay in it, with the aim of getting a steady income.

House-owners who have crossed 60 years of age will be allowed to seek a loan of up to 60 per cent of the value of the residential property. The bank will recover the loan along with interest on the death of the owner or expiry of mortgage period by selling the house and remitting the excess amount to the owner or his heirs. The owners will also have the right to repay the loan to discharge the mortgage. It is hoped many banks will come out with reverse mortgage schemes to open up an income avenue for the seniors.

V. S. Venkatavaradan

Salem

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