Axis Bank, India’s third largest private sector bank, has partnered with India Mortgage Guarantee Corporation (IMGC) to offer mortgage guarantee (MG) backed home loans in the Affordable Housing segment. Home buyers will now be offered an improved loan eligibility upto 20% and they shall also enjoy a higher loan-to-value (LTV) with the mortgage guarantee backed home loans (within the regulatory norms).
The mortgage guarantee provided helps the lender to save capital on the risk insured loan component thereby helping lenders to reach out to a larger consumer base in the affordable housing segment. It will now become easier for credit worthy borrowers, having limited down payment capabilities, to get home loans on better terms.
Speaking on the partnership, Jagdeep Mallaredy, Head – Retail Lending & Payment, Axis Bank, said, “Affordable Housing is one of the most promising segments in the retail finance space. This strategic tie-up with IMGC is another of our endeavours to penetrate deeper into this segment by delivering more value to customers with improved offerings. Mortgage guarantee backed home loans will broaden Axis Bank’s coverage of home loans and also support the government’s mission of Housing for All by 2022.”
Mahesh Misra, CEO, IMGC, said, “We are pleased to partner with Axis Bank and expand their affordable housing lending program. Axis Bank has emerged as an important player in the housing finance space within a short time span. The teams at IMGC and Axis Bank have worked closely to design an offering that shall enable effective segmentation across the self-employed and salaried population. Affordable Housing is emerging as an
area of growth and focus across the mortgage landscape. We are witnessing stepped-up interest in using Mortgage Guarantee as an effective risk mitigant across lending categories.”
Axis Bank is among the top 5 players in the home loans business in India. It was among the first private sector banks to come up with an exclusive offering in Home Loans for the low income segment – Asha Home Loans (launched in 2014). Over the past few years, Axis Bank has continued to focus on developing innovative offerings and mortgage guarantee backed home loans will further broaden its coverage in this space.