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Mortgage Guarantee Firm to be launched by NHB

The National Housing Bank had received approval in establishing a mortgage guarantee company. This information was stated by a top bank official and he also included that they will raise Rs 120 crore of paid up capital in the next two weeks. The National Housing Bank will be assisted by two big companies which are International Corporation (IFC) and Asian Development Bank (ADB).

NHB Logo National Housing Bank

NHB - National Housing Bank

The role of a mortgage guarantee company is to provide credit guarantee to companies involve in housing finance and banks on behalf of home loan borrowers. It is also expected that loan rates are likely to come down by 25 – 50 basis points in the current financial year.

ADB Logo Asian Development Bank

ADB - Asian Development Bank

This is due to some of the possible reduction in the policy rates. The NHB is most likely to spend around Rs 15,000 crore by the financial year ending in June. Though not a lot of people will be affected by this program still this is a good move by the national housing bank.

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