What is reverse mortgage

• A house loan product which helps to generate a stead flow of income throughout the life of a senior citizen couple without sacrificing their ownership right as long as they are alive.

Eligibility

• Age of first borrower: 60 years and above. Married couples could be eligible for joint borrowers (here the age criteria is at the discretion of the Bank for e.g. at least one of them being 60 years or above and the spouse not being below 55 years). • Borrower should be staying at self acquired and self owned house as his permanent primary residence with valid proof of residence. • Borrower should have a clear and transferable title of property in their names. • Property should be free from any encumbrances. Property will have to be maintained in good condition. • The property should not have any loan outstanding against it. • Residual life of property should be at least 20 years in case of single borrower and 25 years in case of spouse being below 60 years of age.

How reverse mortgage works

• Senior citizens can continue to live in that house even after drawing cash-flows from it. • Title holder should make a will in favour of the other spouse confirming that this is the last will and that it supersedes all other wills, if any. Also, that no fresh will shall be made during the currency of the loan. • The RM shall be secured by way of mortgage of the residential property in a suitable form in favour of the bank. • After the initial valuation which to determine the loan amount, subsequent revaluation will be done at intervals of 5 years and accordingly loan amounts will be revised. • In the event of a fall in price, bank may decide to revise the amount before 5 years • The loan could either be a lump sum or it could be in the form of installments. • Loan can be availed