| KAPIL WADHAWAN, managing director of Dewan Housing Finance Corporation Limited (DHFL), the country's second largest private sector housing finance corporation after HDFC, tells Gayatri Ramanathan about the company's new scheme, Saksham. The company with a largely semi-urban and rural customer base recently launched the innovative scheme targeted at senior citizens with little or no income but who own house property, says the DHFL managing director.
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| What is Saksham?
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| Saksham is a scheme, for creating liquidity from your property which is otherwise an illiquid asset. With Saksham, the property owner will be eligible to receive monthly payments against a portion of the appraised value of his/her property.
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| Is this similar to a home loan? How?
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| It is not similar to a conventional home loan. With Saksham the lender pays the customer a monthly annuity based on the appraised value of his/her home. In a conventional home loan, the loan amount needs to be repaid back through EMIs.
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| In Saksham, the customer does not payback the amount during his lifetime. DHFL recovers the money by selling the property after the demise of the applicant and his/her spouse.
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| What is the eligibility for the scheme?
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| Anyone over 60 years and older and retired from active work life. You should be living in your own property. The property should be free of any encumbrances. It should be an approved construction. It should be self-occupied and you should have been living there for at least a year.
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| How will the property be valued?
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| The value of the property will be estimated based on the following parameters: The circle rate of the property, the market value of the property, the longevity and the structural viability of the property, the maintenance of the property, the infrastructure and the amenities provided, all other civil engineering parameters deciding the strength of the building. The appraised value may not be equal to the market value but close to it.
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| What happens if the borrower outlives the tenure of the loan?
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| He or she can continue to stay in the house as long as they are alive. But the payment made will be limited to the tenure of the scheme. The spouse can continue to live in the house after the death of the borrower.
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| Does the property revert back to the estate after the death of the couple?
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| The legal heirs or the applicants themselves can repay the sum due to DHFL and take the property back .
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| What will be the tenure of the loan? How will it be valued before being handed back?
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| As of now, DHFL is offering a maximum tenure of 15 years and a minimum tenure of 5 years. DHFL will conduct a property valuation every 3 years. |
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