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Home >> Personal Banking >> Credit Schemes >> Reverse Mortgage Scheme
PNB is the first Public Sector Bank to come out with a Reverse Mortgage concept based product for senior citizen titled "PNB Baghban". The product addresses one of the very important requirements of the society in the fast changing culture of Indian society. The salient features of the productare given hereunder:
To address the financial needs of senior citizens owning self occupied property (house) by generating income / supplementing pension / other income, for their day to day requirement
The residential house/flat owner, who is resident of India, of the age of 60 years & above, is eligible to raise the loan under this Scheme.
Qualifying/ Maximum amount of loan/ Margin
The qualifying amount of loan will depend on the realisable value of residential property, after maintaining margin of 20%. The maximum qualifying amount of loan, alongwith interest, shall be restricted to Rs.100 lac. (alongwith interest) and to be paid monthly on reverse annuity basis.
Rate of interest
Diabursement/ tenor of loan
The loan shall be extended as regular fixed monthly payments during the loan period. i.e. 10-20 years or till the death of the last surviving spouse, whichever is earlier. Depending on the age of the beneficiary, a chart containing the amount of monthly instalments (calculated on "Reverse Annuity” basis) to be paid to the senior citizen borrower for different tenors of loan per lac of rupees is as under :-
Tenor (yrs) 10 11 12 13 14 15 16 17 18 19 20
Monthly Installment (Rs.) 420 350 300 250 220 190 160 140 120 100 90
Payment of lump sum amount, with a maximum of Rs.15 lacs, under the scheme can also be considered selectively on merit, for meeting medical exigencies of senior citizen borrower and his/her spouse & dependents.

Loan to be recovered only after the death of both the spouses and no loan repayment during the lifetime of borrower.

Settlement of loan, along with accumulated interest, to be met by the proceeds received out of sale of residential property and any surplus to be paid to heirs.  The loan will, as such, become due for recovery and payable six months after death of the last surviving spouse. However the legal heirs/legatee of the deceased borrowers will be given first option to settle the loan, alongwith the accumulated interest, without sale of the property.

Pre-payment of Loan
The option to pre-pay the loan at any time during the currency of loan or later, is available. However, in case there is any takeover of loan by other financial institution/ bank, a charge of 2% on the amount taken over, will be levied.
Upfront Fee
Amount equivalent to half month's loan instalment subject to Maximum of Rs.15,000/- + Service Tax & Education Cess
Documentation/ Inspection Charges
Right of Rescission
After the loan is sanctioned senior citizen borrower(s) shall be given upto 10 days time to relook into his requirements and if he so wishes to cancel the transaction for any reason whatsoever.
For more details, please contact our nearest branch
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