The State Bank of Pakistan (SBP) has decided to facilitate the housing loan applicants by accepting a personal guarantee from a third party. It has given allowance to the applicants looking to avail housing loans under the government’s subsidized scheme.
The banks are reluctant to take risk of the house not being completed or having lack of complete documentation as the completion of the housing unit and mortgage creation takes time. SBP will now facilitate banks in extending low-cost finance by allowing them to accept personal guarantee of third parties until the housing unit is completed and the mortgage is perfected. This guarantee will remain valid for a period of one year and will support home ownership of potential borrowers.
It will assist the applicants to avail housing finance under the government mark-up subsidy scheme issued by the central bank on October12, 2020.