Mangalore-based public sector Corporation Bank today launched "Corp Shelter", the reverse mortgage loan scheme for senior citizens. Under the scheme, a borrower over 60 years of age can borrow a minimum amount of Rs 1 lakh up to Rs 50 lakh depending on the value of the appraised property. | |
| According to a bank release, the borrower should be the owner of a residential property (house or flat) located in India, with a clear title indicating the prospective borrower's ownership of the property. |
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| The residential property shall be free of any encumbrances. The prospective borrowers should use that residential property as permanent primary residence. |
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| The money can be used for any purpose; however, the borrower must pay off any existing mortgage(s) with the proceeds from the reverse mortgage and, if needed, additional personal funds. |
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| The borrower shall not use the proceeds of reverse mortgage loan for speculative, trading purposes. |
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| The bank has waived the prepayment penalty. The borrower can be paid in one lump sum or by way of periodical payments (monthly, quarterly, half yearly and annual). |
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| As a customary friendly gesture and in keeping with international best practices, after the documents have been executed and loan transaction finalised, senior citizen borrowers may be given up to three business days to cancel the transaction, the right of rescission, the release added. |
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| The loan shall become due and payable only when the last surviving borrower dies or would like to sell the home, or permanently moves out of the home for aged care to an institution or to relatives. |
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| The Mortgaged property will also be insured for full value against all risks under Reinstate Value Method. |
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