While expressing his deep concern about the destruction of life and property in the State of Jammu & Kashmir which has recently been hit by an earthquake, Shri P. K. Gupta, Chairman and Managing Director of the National Housing Bank (NHB) announced a concessional scheme to provide refinance assistance through Scheduled Banks and Housing Finance Companies (HFCs) for the people in the affected areas for construction/repairs and renovation of houses.

The salient features of the assistance will be:

1. Refinance assistance will be available to Scheduled Banks and HFCs to the extent of 100 per cent of housing loans given by them, on or after October 10, 2005, to individual borrowers affected by the earthquake.

2. Refinance assistance for loans for construction/purchase of new houses would be available for an amount of upto Rs. 5 lakhs and for repairs & upgradation, refinance assistance would be available for amounts upto Rs. 1 lakh.

3. Refinance will be extended at a concessional rate of 5.50% as against the normal rates of 6.75% and above.

4. Banks/HFCs would not charge interest higher than 6.50% from ultimate borrowers.

5. Refinance assistance could be extended upto a maximum period of 15 years as against 10 years under the normal Refinance Scheme.

6. A moratorium on payment of principal would be made available for a maximum period of 2 years. In deserving cases, a moratorium on payment of interest for 2 years would be available along with a provision for interest capitalization during the moratorium period. In normal refinance scheme, these benefits are not available.

7. As a special case, based on their assessment of the demand, Banks/HFCs can also avail refinance assistance from NHB for their prospective disbursements to the earthquake victims.

8. Detailed guidelines are being issued by NHB in this regard.

Details of the scheme will be available at www.nhb.org.in.

-Sd/-
(R. Rajagopalan)
General Manager