In the backdrop of the recent tie-ups with multiple banks and housing finance firms, India Mortgage Guarantee Corporation (IMGC), targets to insure home loans of around Rs 1,000 crore over the next 12 months.
Since 2013, the company has achieved an insured amount of Rs 800 crore by providing credit guarantees to housing finance companies and banks. ICICI Bank, Diwan Housing Finance and Aditya Birla Housing Finance are the few companies which feature in its partners’ list. Also, they are in talks with multiple public sector banks for tie-ups.
“If we manage to tie up with 2-3 lenders in the next 12 months, that would be a good achievement for us,” says Amitava Mehra, CEO, IMGC.
IMGC provides a secure environment by adopting mortgage guarantee product which compensates banks and housing finance companies for losses occurred when a home owner fails to pay up. The product can help buyers increase affordability for a higher loan. For instance, a salaried individual with monthly income of Rs 50,000 can afford a home of Rs 41 lakh with mortgage guarantee instead of Rs 33 lakh with a loan to value (LTV) of 80 per cent.
Though, Amitava acknowledges that the offtake of this new product has been slow due to lack of education among consumers and sales agents but he is really optimistic about the future, once the awareness is spread.
Source: ET Realty