Is there a loan for low and middle income families for buying or building a house? A friend of mine wants to buy a house in Lahore. He falls within the middle-income category. Is there any financial institution which caters to families of low and middle income? And what about the interest rates?
I looked up the subject online and found out that the interest rates of the banks are quite high and the mechanism is designed to trap you in a circle of interests, which will be quite difficult to come out of. I wanted to know if you know any institution which offers a loan for low and middle income families to buy or build a house.
House Building and Finance Company offers a number of loan options for middle income families for buying or building a house.
It offers several products called Ghar Schemes which cater specifically to low and middle income families -
1. Ghar Pakistan Plus -- offers a loan up to PKR 8.8 million at an interest rate of 13% per year. Can be paid
2. Ghar Pakistan Features -- offers a loan up to PKR 4.5 million at the rate of 12% per year.
3. Ghar Saholat -- offers a loan up to PKR 25 million. The interest rate for salaried individuals is 1-year KIBOR + 3.25 percent and self-employed professionals is 1-year KIBOR + 3.50 percent. Can be paid in 3 to 20 years.
4. Meezan Bank’s Easy Home
Meezan Bank’s Easy Buyers gives a loan from PKR 500,000 up to PKR 50 Million. The interest rate for salaried people is the KIBOR rate plus 3% per year and a re-pricing of KIBOR plus 3% annually. For businesspersons, the interest rate is KIBOR plus 4% per annum and an annual re-pricing of KIBOR plus 4%.
5. Bank of Punjab Apna Ghar
The Bank of Punjab (BOP) offers loans from PKR 500,000 to PKR 50 Million for the purchase of a constructed house. The profit rate for Salaried Individuals is 1 Year KIBOR + 3.5% per year and for self-employed professionals is 1 Year KIBOR + 4.5% per year.
6. JS Ghar Apna
JS Ghar Apna gives a loan for buying a house from PKR 500,000 to as high as PKR 100 million. It offers maximum financing up to 80% of property value and interest rate is as low as 1-Year KIBOR + 4.25% (Floating Rate).
7. MCB Home loan
MCB Home Loan offers financing up to PKR 50 million. It also offers balance transfer facility up to PKR 20 million. Only Pakistani resident nationals are eligible for the loan. The floating rate is employed for home finance which is re-priced on first working day of each January and July of the calendar year. The change would remain constant while the change in KIBOR shall affect the pricing.