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REVERSE MORTGAGE LOAN – “PNB BAGHBAN’ FOR SENIOR CITIZENS by Punjab National Bank

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), for leading a decent life.
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.
Rate of Interest
10% p.a. (fixed) subject to re-set clause of five years (as applicable for Housing Loan Borrowers)
Disbursement/tennure 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 Mortgage” basis) to be paid to the senior citizen borrower for different tennure of loan per lac of rupees is as under :-
Qualifying Loan Amount (Rs.1.00 lac)

Tennure (years)
Monthly Instal-ment (Rs.)
10
490
11
420
12
360
13
315
14
275
15
240
16
215
17
190
18
170
19
150
20
135

Security
The loan shall be secured by way of equitable Mortgage of self aquired / self occupied Residential Property in favour of the Bank.The property to be revalued every 5 years and monthly loan installment to be re fixed keeping in view applicable ROI and valuation of property.
Repayment of Loan
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.
Upfront fee/Documentation Charges
Upfront fee – Amount equivalent to half+ month’s loan instalment subject to Maximum of Rs.15,000/-. Documentation Charges/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.
*For more details contact nearest Branch of Pinjab National Bank*

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