Leading housing finance company LIC Housing Finance Ltd today said that it would launch reverse mortgage product once it gets clarity from National Housing Board (NHB).
Reverse mortgage is a loan product for people over 60 who can mortgage owned house for a lump sum or a monthly installment. The borrower or his legal heir can repay the loan and take back the property failing which the lending company can realise its funds.
Speaking to reporters after inaugurating three day home loan fair, organised by LHFL in Chennai today R R Nair, director and chief executive, LHFL said that currently the loan period is around 20 years and if the borrowers survive that period it will be difficult for the lending institution to realise the funds immediately selling the property.
NHB already held one round of meeting with insurance companies including Life Insurance Corporation of India to design an annuity product so that the funds borrowed can be invested in that and a monthly income is obtained by the borrowers, he added.
Meanwhile the company had set a target to disburse around Rs 14,000 crore during the current fiscal up from Rs 8,800 crore, a year ago.
He noted, recently the company has raised Rs 6,000 crore and will look at raising more money thorugh mix of non-convertible debentures, bank loans and other means as and when required.
Commenting on the NPAs, Nair said, last year our gross NPA was 1.07 percent down from 1.7 percent. This year it will be below one percent. Net NPA will be near zero per cent as against 0.21 per cent logged last year, said Nair.
