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Senior citizens, ‘a good bet’ for growing home loan portfolio

Senior citizens seem to be a good bet for growing the home loan portfolio, going by the disbursements recorded by LIC Housing Finance Ltd (LICHFL) in the last three months.

India’s second largest standalone housing finance company has disbursed over ₹1,000 crore since the launch of a special home loan product – Griha Varishtha – for pensioners in August 2020.

“We are getting a huge response for this product (Griha Varishtha) from senior citizens across the country.

“We disbursed more than ₹1,000 crore since the product was launched in August,” said Siddhartha Mohanty, MD and CEO.

Through this special home loan product, LICHFL is tapping into the proclivity of the golden-agers to bequeath property to their heirs.

Under Griha Varishtha, pensioners up to 65 years of age can get a home loan, with a tenure till the attainment of 80 years or maximum up to 30 years, whichever is earlier.

Eligible applicants

The eligible applicants for home loans under this product include those who have retired from state-owned insurance companies, public sector undertakings, state-owned banks, Central and State governments and drawing pension under Defined Benefit Pension Schemes.

Further, those working with the aforementioned entities, too, are eligible for the loan.

As per the features of the home loan product, the spouse must be a joint applicant, irrespective of the ownership of the property. Children can be co-applicant in the loan and their income can be added for allowing longer term and higher eligibility amount.

Mohanty emphasised that the product comes with additional benefits such as waiver of 6 equated monthly instalments (EMIs) – 2 EMIs each are waived at the end of the 3, 6 and 10th year.

The value of the six EMIs will be almost 5 per cent of the loan amount, he added.

“If a customer opts for an under construction house, we give a moratorium (on principal) for 48 months.

“You need not pay the principal for four years. You pay simple interest only on the amount disbursed (not on the total loan amount) because it is stage to stage construction linked finance,” said Mohanty.


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