Government plans zero collateral housing laons for low annd middle  income groups

The government is firming up a zero-collateral housing loan scheme for low- and middle-income groups which will offer up to Rs 20 lakh with minimal documentation or third-party guarantee, said people familiar with the matter. Amendments to the Credit Risk Guarantee Fund Scheme for Low-Income Housing (CRGFTLIH) are being examined to pave the way for the scheme, they said, adding that the loan could have a tenure of 30 years. Under the existing provisions, housing loans up to Rs 8 lakh are eligible for guaranteed cover. "The idea is to make credit available for those homebuyers who do not have any documented income or minimal supporting documents. Talks are on between the ministries of finance and housing & urban affairs, National Housing Bank and other commercial banks to firm up the parameters such as eligible income and equated monthly instalment and net monthly income ratio. A bank executive said up to 70% of the loan amount in default will be guaranteed under CRGFTLIH. Changes to its operational guidelines dealing with the extent of the guarantee and coverage period are being examined. In August, the government increased the corpus fund of Credit Risk Guarantee Fund Trust (CRGFT) to Rs 3,000 crore from Rs 1,000 crore to provide benefit of credit risk guarantee on affordable housing loans to EWS and LIG households. Under Pradhan Mantri Awas Yojana-Urban 2.0, government assistance of Rs 2.30 lakh crore will be provided to 10 million urban poor and middle-class families through states or union territories to construct, purchase or rent a house at an affordable cost in urban areas in five years.
 

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