UBI launches reverse mortgage sch for seniors

Union Bank of India (UBI) today launched its reverse mortgage scheme for senior citizens. The scheme will enable senior citizens to obtain a monthly payment by mortgaging their residential property. Under the title "Union Reverse Mortgage Scheme", the bank will offer benefits to people aged above 60 years.

The loan drawn against mortgaged property will have fixed interest rate of 10% per annum. The same will be revised after every five years. "We will give loans from Rs one lakh up to Rs 50 lakh against a residential property where the senior citizens are living. The duration maximum of the loan would be 15 years," Union Bank's Pune Zone General Manager YP Gupta said.

The scheme is available at all branches of the bank. "Typically, for a loan amount of Rs 10 lakh for 10 years, the house owner will be able to draw monthly amout of Rs 4,880," Gupta added, the bank wants to reach maximum number of senior citizens through this scheme. "The scheme can be extended even after 15 years, if the valuation of the residential property has increased," he stated.