Union Bank of India became the first nationalized bank to launch the reverse mortgage scheme in the country for the benefit of the senior citizens. People of the North-East will also be able to get the benefits of this scheme, courtesy the operations of the UBI in the North-Eastern region. S. N. Tripathi, DGM, NE Union Bank of India revealed the scheme in Guwahati for the North-East.

In the North Eastern Region by opening of a new Branch at Itanagar in Mrach 2008 Union Bank’s reach has spread in four States of the region with 58 Branches with 100% CBS facility and 8 Nos. ATMs.  Total business of the Region has crossed 2000 crores as of date. Region could open more than 30000 No. frill accounts by March 2008 to reach to the people not covered under banking habits under financial inclusions. 1748 Nos. of self Help Groups have been formed by our Bank and out of which linkage have been provided to 1093 groups and further is in progress. Union bank has been awarded “Raj Bhasha Shield” for the year 2007 among the PSUs of the North Eastern Region. The Bank has an ambitious plan of opening another 15 branches in NER in the year 2008-09 and to cover all the remaining 3 states which have not been covered till March 2008. Our bank is also planning to open another 15 ATMs in the Region. Union bank’s aims to reach a business mix of Rs.232000 crores by the end of March 2009, a growth of approx.29% within which Rs.135000 crore will be Deposits (growth of 23%) and Rs. 97000 crore of advance. The Bank plans to aggressively market technology based products targeting segments such as   the youth and mass affluent groups. Non-recourse loan that enables homeowners of age 60 and older to convert home equity in to tax-free proceeds.

Reverse Mortgage seeks to monetize the house as an asset and specifically the owners quity in the house. Scheme involves senior citizen borrower mortgaging the house property to a lender/financial institutions, who then makes periodic payment to the borrower during the life time.

Borrower can opt for Monthly payments for his sustenance. In spite of Mortgaging the house under the scheme, the house owner retains the ownership, is entitled to live in the same throughout his lifetime and also has access to regular income stream.

No monthly repayment of loan during his lifetime and therefore does not make monthly repayment of principal and interest to the lender.

On the death of the borrower or an borrower leaving the house property permanently, the loan is repaid along with accumulated interest through sale of house property.

The borrower’s heir can also repay or prepay the loan with accumulated interest and have the mortgage released without restoring to sale of the property.

Provide financial independence in old age

Supplements regular source of income.

Helps in meeting Health care expenses.

Helps in meeting financial needs and maintaining current living standards.

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