HBFC
(House Building Finance Corporation)
Introduction:
The House Building Finance Corporation (HBFC) (now incorporated under companies as "HBFC Ltd." ordinance 1984 since July, 2007) was established in the year 1952 as a Statutory Federal Body with the object of providing financial assistance for construction and purchase of houses to the people of
Vision:
To be the prime housing finance institution of the country, providing affordable housing solutions to low and middle income groups of population by encouraging new constructions in Small & Medium Housing (SMH) sector.
To be a socially responsible and commercially sustainable housing finance institution.
Target market – Low income and middle income groups of populations
Target areas – No negative list, all legalized residential locations
Responding to housing needs of low income groups is a social responsibility, beyond that everything has to be 100% commercially viable and sustainable to ensure an on going housing finance entity.
Products:
Finance Facility for Small Builders
Company Profile:
House Building Finance Corporation, the oldest housing finance
Since inception todate, the corporation has financed over one and half million units for Rs. 41.437 billions, provided housing finance facility to 28 corporate clients for Rs. 1.7 million, made recoveries of Rs. 51.368 billions and has outstanding portfolio of Rs. 19.6 billion. Disbursed Rs. 600 millions flood loans to over Rs 0.4 million affected families granted remissions to Widows, Orphans and retired Government Servant of Rs. 1.23 billion on Federal Government’s directive. Its Average annual disbursements and recoveries are around Rs. 2-1/2 to 3 billions. It has contributed Rs. 17.149 billion towards National Exchequer in shape of payment of interest, profit and income tax to Government and State Bank of
HBFC’s paid up capital is Rs. 3.50 Billion (53.7 percent for Federal Government and Rs. 46.43 percent for State Bank of
HBFC Ltd. which was on its way to become a corporate organization has finally been incorporated as “HBFC Ltd.’’ under Banking Companies Ordinance 1984, since July, 2007. Henceforth, Part privatization by offering share holding to firms like IFC, ADB and IDB etc is also a part of the agenda. HBFC Ltd. is also intent upon the securitization of mortgages and establishment of Real Estate Investment Trusts (REITs) and Mortgage Bonds (MBs).
To meet the upcoming corporate challenges and to cater to the growing needs of the corporation, HBFC Ltd. has taken certain drastic steps. It is enhancing its operational efficiency through preparation and implementation of manuals, computerization, human resource development and elimination of ineptness and corruption through internal controls and redesigned reward structure. In the near future HBFC Ltd. plans on expanding its outreach representative offices from 80 to 150 towns and cities. HBFC Ltd. is trying to augment its market image by having pro-active, efficient and customer friendly policies.
Thus HBFC Ltd. is paving the path for a brilliant future by amplifying its present
HBFC Ltd.‘s main aim has remained to provide Sharia compliant financing to its consumer market. HBFC’s financing schemes have also evolved over its 55 years of establishment to acquiesce with this aspiration. These schemes have propelled HBFC towards the fulfillment of its Business Focus which is to accommodate the low and middle income group’s housing needs. Thus HBFC offers a wide range of products for the ministration of its consumers. House Construction Financing, financing for purchase of house/flat, renovation of House (Home improvement financing), loan transfer and Balance transfer fund is the range offered by this organization.
At present HBFC Ltd. has following housing finance schemes in operation:
1. “Ghar Aasan Scheme” based on diminishing Musharka, a Shariah compliant scheme under which credit for construction and purchase of houses is allowed.
2. “Shandar Ghar Scheme” under which credit for repairs, renovation/up-gradation is available.
3. “Loan facility for Small Builder ” for construction and sale of small houses/flats
4. “Ghar Aasan Scheme (Flexi)” for construction, purchase and renovation for houses/flats
New up-coming Schemes
1. Step-up-plan
2. Savings and Loan Plan
3.
4. Construction Project Finance
5. Residential Hostels Finance
6. Home Finance for Overseas Pakistani
7. Syndicated Finance for Large Construction Projects
The earlier schemes which were discontinued were Interest bearing scheme, Profit & Loss scheme based on income sharing and Simplified & New Simplified Schemes base on income sharing.
HBFC Ltd. FUTURE PLANS:
HBFC Ltd. has been a household name traditionally associated with housing finance. The scenario changed with the entry of banks and leasing/house finance companies in the house finance sector from late 1990. HBFC Ltd. had reconsidered its whole business philosophy. This was rather inevitable for its survival. The new management has brought a revolutionary changes for the Corporation in all areas of its working including Operations, Human Resource, Administration, Finance, IT, etc as well as client services.
The strategic changes being initiated is expected to help HBFC Ltd. emerge as a vibrant and customer friendly housing finance institution thereby establishing more firmly its age old place in the field of house financing with a new look. HBFC Ltd. occupies a special place in the house finance business as it has all along catered to the needs of the lower and lower-middle income groups whereas the commercial banks have targets of high profile clients. Commercial Banks have a large negative list of locations as well as professions. HBFC Ltd., on the other hand does not maintain any negative list of locations or professions and it rather encourages applicants from lower income localities, as long as housing constructions are on valid land title and the client meets other minimum eligibility criteria. Presently nearly 85% of HBFC Ltd.’s clientele is low-income people where loan amount is less than Rs.100, 000 whereas nearly 80% clients have per party loan below Rs.500, 000 and have monthly income between Rs3, 500 to Rs5, 000 and could only afford to pay an installment of Rs1000 to Rs1200 per month in 15 to 20 years besides meeting their monthly expenditure of basic necessities. For HBFC Ltd., its social role is an integral and inseparable part of its commercial stance.
Since the beginning of the year 2005, HBFC Ltd. is striving for a new outlook with a new ideology. Consequently, it has changed its Vision to “to be the prime housing finance institution of the country, providing affordable housing solutions to low and middle income groups of population by encouraging new constructions in Small & Medium Housing (SMH) sector”. Its
IMPROVE CORPORATE IMAGE OF HBFC Ltd.:
As pointed out above HBFC Ltd. has network of about 58 branches all over
MEGA HOUSING SCHEMES FOR SMALL AND MEDIUM HOUSING UNITS:
HBFC Ltd. is actively working in association with the Provincial Governments, Corporate Bodies, Industrial Estates and Public Sector Organizations to develop mega housing schemes comprising of small and medium housing units, based on horizontal and vertical housing solutions. NESPAK is working as HBFC Ltd.’s consultant for developing such schemes. In view of the fact that the housing shortage in the country, particularly for lower and middle income groups of the population is acute and needs some mega solutions, these mega schemes have achieved paramount importance for the HBFC Ltd. Accordingly, while containing its retail housing finance products, HBFC Ltd. will focus on bulk housing schemes so that the housing stock in the country gets increased on fast track.
HOUSING FINANCE FACILITIES TO OVERSEAS PAKISTANIS:
HBFC Ltd. would be launching an online program for the overseas Pakistanis to facilitate them in owning a house in
HBFC Ltd. will provide financing facilities as well as “property related service”, which include help in locating suitable residential locations with detailed information on lists of properties available, classified by location and price with detailed specifications. Subsequently HBFC Ltd. would be providing them with additional services such as evaluating the reliability of developer, perusal of the legal documentation, periodic visit to the project’s site, helping them to determine initial down payment for booking and assist them in completion of purchase transaction.
OTHER HOUSING SCHEMES:
Other schemes include schemes where experience of
PAYMENT OF STATE BANK OF
Consequent to the direction of the Central Government to make the Corporation a self-sustained institution, all out efforts were directed towards achieving this objective. Despite of the fact that no fresh credit lines from SBP were available since 1992, HBFC Ltd. has been able to make following repayments to SBP by the due dates:
|
| Installment |
| Amount (Rs. in Billion.) |
| Year of Payment |
| 1 | First |
| 1.239 |
| 2002 |
| 2 | Second |
| 1.400 |
| 2003 |
| 3 | Third |
| 1.250 |
| 2004 |
| 4 | Fourth |
| 1.365 |
| 2005 |
No payment after 15 January 2005 as in Treasures Department.
The remaining amount of Rs. 1.243 billion is to be repaid over the next seven years with last payment is due in the year 2012. HBFC Ltd. expects itself to honor its obligation without much difficulty.
FIRST TFC ISSUE OF RS. 300 MILLION:
As a first step towards becoming a self sustained institution, HBFC Ltd. arranged a privately place TFC of Rs.300 million with M/s Pak-Libya Holding Company (Pvt) Ltd for 3 years on November 5, 2003. The repayment of TFC was to be made in 12 equal quarterly installments of Rs.332.58 million (mark-up plus principal) each. HBFC Ltd. has since paid all 12 such installments up to November 2006 on due dates. In view of this good track record of timely repayment, image of HBFC Ltd. has improved and it would help the Corporation in obtaining future finances on attractive terms.
LONG/SHORT TERM CREDIT RATING MAINTAINED:
HBFC Ltd. has succeeded in maintaining long term (A) and short term (A1) credit rating for the third consecutive year. These rating are indicative of strong capacity for timely repayment and low expectation of credit risk.
These ratings have been assigned by the PACRA, the leading credit rating agency of Pakistan. These ratings have been awarded on the basis of a steady improvement in organizational performance particularly in disbursements of “Ghar Aasan” and “Shandar Ghar” Schemes and timely repayment of our obligations.
With new initiatives underway, improvements in credit rating are expected in future years.
Board Of Directors:
Mr. Zaigham Mahmood Rizvi
Chairman
Chairman
House Building Finance Corporation Ltd. (HBFCL)
Karachi
Mr. Muhammad Iqbal Hussain
Director
Sr. Joint Secretary (Investment)
Ministry of Finance,
Islamabad
Mr. Ijaz Ahmed Malik
Director
Retired Secretary
Government of Pakistan
Islamabad
Mr. Tariq Iqbal Khan
Director
Chairman & Managing Director
National Investment Trust Ltd
Karachi
Mr. Tasneem Ahmed Siddiqui
Director
Retired Director General
Sindh Katchi Abadis Authority
Karachi
Mr. Zakaria M. Fazil
Director
Executive Member
Association of Builders & Developers (ABAD)
Karachi
Mr. Tahir S. Effendi
Secretary
Executive Director
House Building Finance Corporation Ltd. (HBFCL)
Karachi
Management Profile:
Mr. Zaigham Mahmood Rizvi
Chairman
Mr. Zaigham Mahmood Rizvi, is the Chairman of House Building Finance Corporation Ltd. Mr. Rizvi has a diversified blend of academic qualifications holding a Masters Degree in Business Administration [USA], besides a Masters Degree in Economics and Engineering. Mr. Zaigham holds Diploma Institute of Bankers Pakistan and was rewarded with a gold medal. Mr. Zaigham also holds a qualification of Institute of Chartered Secretaries of Pakistan Association in Development Bank Management. He has been a Fulbright Scholar - USA from 1975-1977.
Mr. Zaigham Rizvi has overall professional experience of 28 years spread over diversified fields of Manufacturing, Academics, Development & Investment Banking both in Pakistan and overseas.
Mr. Rizvi’s last tenure was as the Managing Director, Pak-Kuwait Investment Company (Pvt) Ltd (PKIC), a joint venture Financial Institution between Pakistan and Government of Kuwait started on March 19, 2001. Under his guidance and supervision, the Company not only excelled in nearly all areas of its financial performance, it also attained new levels of a well disciplined organization, having well documented systems and procedures. Same is recognized by its shareholders /Directors; it is candidly announced by external evaluation like “AAA” Rating by the two Credit Rating Agencies, the Corporate Governance Rating of CGR-9 and the ISO 9001: 2000 Certification. He remained in Pak-Kuwait till January 25, 2005.
Prior to PKIC, Mr. Rizvi tenure, with Pak-Libya Holding Co. (Pvt) Ltd., also a joint venture financial institution, was also marred with visible signs of improvement in the company’s operation and profitability since he assumed its charge in December 1996. During the period the company’s balance sheet sized grew from around Rs. 4.0 billion to Rs.10 billion, its operations largely diversified and profits nearly doubled.
Mr. Zaigham has served for 5 years the manufacturing sector at Dawood Hercules Chemicals Company, a fertilizer plant in Pakistan. He has served with Oman Development Bank - Oman for 8 years. His business links with the financial circles of the Arab World spread over 22 years, providing him with good networking and exposure to financial circles of the Arab world.
Mr. Zaigham Rizvi has also served on the Boards of many Corporate Entities in Pakistan including Islamabad Stock Exchange (ISE) for three consecutive terms and the SECP nominee Director on the Board of Karachi Stock Exchange.
Mr. Rizvi is the Chairman and Founder of Mutual Fund Association of Pakistan and Vice Chairman of Pakistan Banks Association. He has been playing a key developmental role in promotion of the IT industry in Pakistan, while promoting Pakistan's First IT Venture Capital Company, PakVenCap.com Private Limited. He is recipient of IT Excellence Award 2002 for IT Pioneer.
Senior Executives:
Mr. M.A. Wahid,
Executive Director,
Head of Support Functions.
Mr. Mujahid Zameer,
Executive Director,
Provincial Chief Region-C, Sindh & Balochistan.
Mr. Tahir Saeed Effendi,
Executive Director,
Head of Finance
Chief Financial Officer
Company Secretary
Mr. M. Shabbir Alam,
Executive Director,
Head of Recovery & Special Projects.
Mr. Nadeem Rafi Khan,
Executive Director,
Provincial Chief Region-B, Punjab.
Mr. S.A.S.A. Sayef Hussain,
Executive Director,
Head of Audit/Chief Internal Auditor (CIA).
Mr. Syed Shahood Alam,
Executive Director.
Mr. Khalid Aftab Khan,
General Manager,
Head of Policy & Planning.
Mr. Paul Francis,
General Manager,
Head of Information Technology.
Mr. Rehan Wasi,
General Manager,
Head of Treasury.
Mr. Mohammed Akram Tariq,
General Manager,
Housing Project Zone.
Ms. Sarwat Gilani,
General Manager,
Head of Risk Management.
Products of HBFC:
The Management of HBFCL has taken bold steps in helping its customers obtain affordable quality housing to fulfill their individual needs and expectations. We are now committed to play a prominent role as a socially responsible and commercially sustainable house financing institution of the country.
The Ghar Aasan Scheme will support you in purchase or construction of house / flats. The salient features of the scheme are as following :
1. Financing support up to Rs.75,00,000/ is accessible to be provided to all
prospective customers subject to the customer’s eligibility & location of the
project.
2. The loan can be repaid over a maximum repayment period of 20 years in
affordable installments depending on the customer’s age, repayment ability and the share in the rental income.
3. The overall cost in acquiring housing under the scheme is much more
attractive as compared to other financing institutions.
4. Sharia compliant scheme.
5. Hassle free investment & repayment facility.
How to Apply
Prerequisite for Construction/Extension of house:
·Title to land
·Construction minimum up to plinth with DPC
·Proof of repayment capacity
·Age (Minimum 18 to Maximum 59 years)
1. Application Form* of Ghar Aasan Scheme to be filled out completed by the customer.
2. Concerned Representative Office or District Office to be visited by the Customer with the required original documents along with a set of Photostat copies, Application Form duly filled in and 3 recent passport size photographs.
3. The customer’s documents shall be scrutinized for compliance of the requirements (target: same day).
4. the customer will be interviewed by the District Manager.
5. The customer’s investment application will be registered after payment of required amount for which a receipt will be given to him;
6. Legal scrutiny of title documents will be carried out by our Law Officer/Legal Advisor/Advocate. (target: 3 days)
7. The customer’s income will be verified by an authorized officer of HBFCL.
Proof of Income:
The customer is required to produce proof of his income which shall form basis for determining his eligibility for a loan depending on his capacity to repay.
Our District Manager shall be pleased to guide you through the rest of the process.
Sanction 0f Investment:
By the credit committees at Zonal, Regional & Head Office.
Note: There are 12 Zones in HBFCL; each Zone is controlled by a General Manager or a Zonal Manager.
Steps after Sanction of Investment:
· Issuance of acceptance letter (The customer should carefully read the terms of acceptance letter and give his consent by signing the document);
· Inspection of your house/flat/site by HBFCL authorized officer to check the stage of construction.
· Photographs of the site will be taken;
· Conformity of construction with approved building plan will be checked;
· Deposit of post-dated cheques by the customer according to the repayment schedule will be required;
· Fixation of stamps and completion of assignment deed will follow.
· The customer will provide us with the insurance premium paid receipt of advance 24 months.
· Promissory Note and Letter of Continuity to be signed by you.
· Undertakings by applicant(s), guarantor(s) if any.
Release of HBFCL disbursement (i.e. HBFCL investment in your property):
On completion of above formalities, investment shall be released to the customer according to the stage of construction in tranches/ installments according to the specification of sanction letter.
The first cheque shall be delivered in the presence of Sub-Registrar at the time of execution of Deed of Assignment. Subsequent cheques shall be delivered, concomitant to the stage of construction, as specified in Acceptance letter and in Deed of Assignment.
For purchase a house/flat Requirements:
· The vendor (seller) should have clear and marketable title, free from all encumbrances. The house/flat should not be more than 45 years old, have sound and solid construction. Investment will be made at all the coastal areas except for the front row of Sea View Township and Darakhshan Villas Clifton, Karachi subject to submission of soundness Certificate from the PBA approved evaluators.
· House purchase facility is available in Urban Area at District Quarter / Tehsil subject to the condition that construction should be “A” Class & all basic amenities of life should be available.
· Sale Agreement, Title Deed, Valuation and Soundness Certificate (as per format) from an approved Architect will be required in addition to other documents. Investment shall be released in one tranches / installment. The cheque shall be delivered to you in the presence of Sub-Registrar at the time of execution of Deed of Assignment.
HBFCL Message to its Partners:
Our goal is to assist in providing affordable housing finance and to develop a reputation as a premier financial institution providing service in a reliable, efficient and customer friendly manner.
Eligibility Criteria:
Age:
Applicants between 18 to 60 years of age are eligible for this scheme in order to authenticate confirmed clearance of the investment liability (relax able up to 65 years on case to case basis).
If the customer is not in a position to clear the investment liability within 60 years of age, he can provide guarantee of person or persons having inheritable right in his property who could take repayment of investment liability within the above age limit, in deserving case, guarantee(s) of brother(s), sister(s) or their adult children i.e. sons / daughters in Law etc. are also acceptable.
Race, Caste, Creed :
All Muslim or non-Muslim citizens of Pakistan, Azad Kashmir, Northern Areas
Income :
The customer should be employed / self-employed and have sufficient repayment capacity to meet the investment obligations; Proof of income: Salary Certificate, Affidavit, Tax Return
Property :
The customer should already possess ownership of the residential plot upon which house is intended to be constructed or Addition of floors/ additional rooms to the house is intended to be made.
Purchase of house/ flat :
The vendor should have clear and marketable title free from all encumbrances and the house/flat is not more than 45 years old.House purchase facility is available in Urban areas of District Quarters/Tehsil subject to the condition that construction should be "A" class and all basic amenities of life should be available.
Maximum covered area :
No limit.
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| Repayment Period = Maximum 20 Years | |||||||||||||||||||||||||||||||||||||||||||||||||
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The Management of HBFCL has taken drastic steps to help people add value to their existing abodes at a reasonable cost. These efforts are targeted at fulfilling individual needs and expectations. HBFCL is actively aiming at playing a remarkable role as a socially responsible and commercially sustainable housing finance institution.
Hence HBFCL has devised a scheme by the name of Shandar Ghar (home Improvement Scheme), which is purported to support the borrowers to purchase materials, fixtures and fittings for the renovation of their houses.
Its salient features are as under:
1. The maximum financing support HBFCL offers is up to Rs.2,500,000/-;
2. The loan can be repaid over a maximum period of 10 years in affordable
installments.
3. The applicable Murabaha profit is 13.5%. Thus the overall cost charged to
each borrower will be considerably less as compared to other financing
institutions.
4. This is a Sharia compliant scheme based on Murabaha mode of financing.
5. It offers hassle free investment & repayment facility.
6. Early repayment facility is available.
Eligibility Criteria:
All Pakistani nationals having clear title to the residential property in which repair renovation and improvement is required. Employed /self employed / own business, having sufficient repayment capacity. Existing partners of HBFCL with active accounts.
Financing shall not exceed:
50 % of the Incremental value of the property i.e. (forced sale value of the property + bill of quantity).
80% of Government Saving Certificates, or
80% of the registered Provident Fund balance of the customers in his/her terms of employment.
Subject to minimum of RS. 25,000/- and maximum of RS. 2,500,000/- and adequacy of income.
Security :
Equitable mortgage of the house.
Localities :
·Financing under Shandar Ghar Scheme is available in all the urban areas of Pakistan.
·Additional collateral of moveable or immoveable property offered by the applicant at the discretion of HBFCL.
·The property to be renovated /improved shall be RCC/RBB construction.
Repayment Period :
Up to 10 years.
Repayment Capacity:
| Repayment Capacity—New Customers : | ||||||||||||
| 1. | Up to 50% of net monthly/verifiable income i.e. (Gross Income minus deductions = Net Monthly Income): If the total cast of house is double of the amount of investment applied. In other cases the current repayment capacity @ 40% of the net monthly / verifiable income will continue to be taken. | |||||||||||
| 2. | Existing Partner: Up to 50 % of net monthly/verifiable income i.e. (Gross Income minus deductions minus monthly installment of existing investment payable to HBFCL = Net Monthly Income); if the total cost of the house is twice the amount of investment applied for. In other cases the current repayment capacity @ 40% of the net monthly/verifiable income i.e. (Gross Income minus deductions minus monthly installment of existing investment payable to HBFCL = Net Monthly Income) will be taken. If the entire investment has been availed on affidavit declaring that the deponent 9 applicant/guarantor) have sufficient means to pay back the investment, Affidavit shall be accepted on the same pattern. | |||||||||||
| Application Fee : | ||||||||||||
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Lending Rates:
| Location | = All the urban areas of Pakistan |
| Repayment Limit | = Maximum 10 years |
| Investment Limit | = Maximum Rs. 2,500,000/- |
| Rate of Profit | = 13.5% |
C) Finance Facility for Small Builders:
A large number of Small Builders are engaged throughout the country in constructing and selling individual houses on small scale. In order to encourage them, HBFCL has launched "Finance Facility for Small Builders" which will help Overcome the shortage of houses in the country and would simultaneously be instrumental in boosting up national economy as a whole.
Salient Features:
1. Mode of Financing
Musharakah.
2. Financing Limit.
PKR 7.5 Million
3. Facility Tenor
12-15-18 Months (optional) – extendable for further 03 months. The Builder shall
be required to complete and sale house(s) / flat(s) within one of above agreed or
extended tenor of investment. Extension shall be granted by the respective Provincial Chiefs on receipt of such request in writing from the builder one month before the expiry of agreed tenor.
4. Availability
Initially, this facility shall be available in Karachi, Lahore, Islamabad/Rawalpindi, Multan, Faisalabad, Peshawar, Quetta, Abbottabad & Wah Cantt. (cities only).
Qualifying age
4. The Builder should be at least 25 years of age and not more than 65 years at the time of the maturity of Musharakah.
6. HBFCL’s Equity
a) House
50% cost of the house as assessed by the Corporation.
b) Flat Project
50% cost of project or the estimated cost of construction whichever is less.
7. Profit
14.5% p.a. (in form of utilization cost of number of Musharakah unit(s) outstanding).
8. Musharakah Unit(s)
Corporation’s Finance Facility will be divided into Musharakah unit(s) according to the number of houses/flats. The Builder will purchase such unit/unit(s) at its/their face value within the agreed or extended tenor of Musharakah.
9. Mode of payment
The builder will be required to submit separate post-dated cheque(s) for the profit as well as for the amount finance facility, in advance.
10. Payment of profit
The profit will be calculated for the agreed (opted) tenor of Musharakah, which will also be payable in lump sum through a post-dated cheque(s). In case of extension in agreed tenor for further 03 months, the Builder will pay profit of extended period in lump sum through additional post-dated cheque(s).
11. Purchase of units
The Builder shall be required to purchase the Musharakah Unit/Units within the agreed tenor or shall submit before the expiry of agreed/extended tenor, application(s) from the intending buyer(s) for transfer of Corporation’s Finance Facility, as per his/her entitlement under Ghas Aasan Scheme (GAS).
12. Maximum No. of facilities at a time
The Builder can avail upto two finance facilities at a time, subject to maximum of Rs. 7.5 Million.
13. Personal information
The Builder will be required to submit personal information along with supporting documents only once and the same will not be demanded again if he initiates another project and apply for another facility. However, it will be the responsibility of the builder to immediately intimate any change in his particulars provided to HBFCL earlier.
14. Valuation of property
The projected construction cost of house/flat shall be assessed as per following rates of construction:-
a) Posh Localities declared by the Corporation:
i) Individual house Rs.1000/- per Sq. Ft.
ii) Flats/Apartments. Rs.750/- per Sq. Ft.
b) Other than Posh Localities:
i) Individual house Rs.750/- per Sq. Ft.
ii) Flats/Apartments. Rs.650/- per Sq. Ft.
The valuation of land shall be carried out by one of the HBFCL approved valuers and fee (s)/charges thereof shall be payable by the Builder as fixed by HBFCL.
15. Admissibility of Finance Facility
The admissibility of finance facility shall be worked out on the basis of declaration through affidavit of sufficient repayment capacity by the builder as an applicant/guarantor as the case may be, which shall, invariably, be verified/certified by the concerned Zonal Head.
16. Processing Fee
The following non-refundable processing fee shall be deposited by the builder in any authorized HBL branch at the time of submission of application for investment:-
a) Rs.15000/- for an investment upto Rs.5 Million.
b) Rs.20000/- for an investment above Rs.5 Million.
19. Ownership of the property
Plot(s) on which house(s)/flat(s) are to be constructed should preferably be in the personal ownership of the builder. Where the plot(s) is/are in the ownership of the builder’s spouse or children they can apply for grant of this facility in their own name on the guarantee of their father/husband (builder) or vice versa. 3rd party ownership of the plot shall not qualify for this facility.
20. Closing of Loan Account
The account will be closed immediately on full and final settlement of Corporation’s all outstanding dues.
The role of the House Building Finance Corporation Ltd remained everlasting for refurbishing the housing finance sector of the country. As-such, the Management of HBFC Ltd always remained eager to introduce prudent housing finance policies, according to market demands, to suit the need of the people of the country and to provide affordable housing finance facilities to play a much bigger role to become a socially responsible and commercially sustainable house financing entity of the country.
This product is based on the concept of Diminishing Musharaka and has four modules for the following purposes:-
(i)Purchase of a residential property
(ii)Construction of residential property
a. Residential construction on Applicant’s owned land;
b. Residential construction on applicant’s owned house (on advance stage of Construction i.e. up to lintel level or Roofed)
(iii)Renovation of an existing residential property
(iv)Replacement of an existing housing finance (Balance Transfer Facility)
This scheme facilitates customer for purchase/construction/renovation/BTF of house/flats.
The salient features of the scheme are:-
Maximum Ceiling:
1- Financing facility up to Rs.7.5 million for purchase/construction/Balance
Transfer Facility subject to the customer’s eligibility & location of house/flat.
For renovation maximum financing limit up to Rs.2.5 million.
2- The investment is repayable in affordable installments over a maximum period
of 20 years depending upon the customer’s age and repayment ability.
3-The overall cost in acquiring housing under the scheme is moderate as compared
with other banks;
4-Early unit purchase option after the lock out period (lock out period means first 3
years during which advance units purchase to the customer is prohibited). After
lock-out period the customer can purchase as many number of units as the customer
wishes, once in a year subject to prepayment charges. By making advance
payment, the customer will avail two benefits i.e. get revised and reduced his/her
monthly installment on lower side or get reduced the period of loan.
5-Security: equitable/registered mortgage.
6-Sharia compliant scheme.
7-Hassle free repayment facility.
How To Apply:
Pre-requisite for Construction of house:
·Title to land
·Construction, minimum up to plinth with DPC
·Proof of incom
·Age
Procedure:
1. The Customer is required to visit concerned Representative or Branch Office along with all original documents with a set of photocopies, CNIC, 3 Color Passport Size Photograph (recent), Credit Card No. and NTN Number (if applicable).
2. The customer’s documents shall be scrutinized for compliance of the requirements (target: same day).
3. The customer will be interviewed by the Branch Manager (target: same day)
4. The customer’s investment application will be registered after payment of required fee through payorder for which a computerized receipt will be given;
5. Legal scrutiny of title documents will be carried out by our Law Officer/Legal Advisor/Advocate.
6. Customer Relation Officer (CRO) will record applicant's particulars in an application form electronically and a copy of the same will be given to him/her to check the same. If the same founds correct by the applicant, the signature of the applicant will be obtained thereon.
7. The customer’s income will be verified by an authorized officer of HBFC Ltd.
8. Credit history will be checked through e-CIB, Data Check and NewsVis.
Proof of Income:
The customer is required to produce proof of his/her income which shall form basis for determining his eligibility for a loan depending on his/her capacity .
Sanction of Investment:
By the credit committees at Zonal, Regional Office.
Steps after Sanction of Investment:
·Issuance of acceptance letter (The customer should carefully read the term of sanction letter and give his/her consent by signing the document);
·Inspection of the house/flat/site by HBFC Ltd. authorized officer to check and ensure that the stage construction is in accordance with thte specifications mentioned in the sanction letter.
·Photographs of the site will be taken.
·The 3rd Tranche shall invariably be released subject to satisfactory site inspection report of stage of construction by the PBA approved valuers and on those locations where there are no PBA approved valuers on the panel of HBFC Ltd, the site will be got inspected through the representative of the Zonal Office, on the discretion of the Zonal Manager.
·Conformity of construction with approved building plan will be checked.
·The customer will be asked to give standing order/debit advice to the bank to debit his/her account & transfer the monthly instalment's amount to HBFC Ltd's Collection Account. In peculiar cases, where the Branch/Zonal managment is of the view that debit instruction is not possible, the Provincial Chief & Zonal Chief will jointly allow the branch office to receive PDCs (Post Dated Cheques) for collection.
·The customer will provide the insurance premium's paid receipt of advance 12/24 months as the case may be.
·Promissory Note and Letter of Continuity to be signed by the customer.
·Undertakings by applicant(s), co-applicant(s) and guarantor(s) (as the case may be).
Release of HBFC Ltd. disbursement (i.e. HBFC Ltd. investment in the property):
On completion of above formalities, investment shall be released to the customer according to the stage of construction in tranches/ installments according to the specifications of sanction letter.
Equitable Mortgage:
100% equitable mortgage in the leasehold residential properties in large cities i.e. Karachi, Lahore, Rawalpindi/Islamabad, Multan, Faisalabad, Hyderabad, Quetta and Peshawar subject to observance of the following:-
- Having sufficient market value with memorandum of deposit of title deeds.
- Red entry on record of rights (where applicable).
- Intimation to concerned sub-registrar and lease issuing authority with irrevocable General Power of Attorney in favour of HBFC Ltd.
Registered Mortgage:
In rest of the areas throgh conventional method of Registered Mortgage Deed.
For purchase a house/flat Requirements:
· The facility of investment for the purchase of finished house will be available in Urban areas of Tehsil and District Headquarters only.
- The maximum age of the house having ‘A’ Class construction should not exceed 45 years (countable from the date of approved building plan) i.e. a house aged 40 years shall be admissible for investment up to maximum of 5 years.
- Investment may be made at all coastal areas except for the front row of Sea View Township and Darakhshan Villas, Clifton Karachi subject to submission of soundness Certificate from the Pakistan Banks Association approved valuers.
- Further at Tehsil level subject to the condition that the property intended to be purchased is built with “A” class construction having all basic amenities of life. More-so, the value of the house as per existing policy has been got valued from the PBA approved valuers.
- House purchase facility is available in Urban Area at District Quarter/Tehsil subject to the condition that construction should be “A” Class & all basic amenities of life should be available.
- Sale Agreement, Title Deed, Valuation and Soundness Certificate (as per format) from an approved Architect will be required in addition to other documents. Investment shall be released in one tranche/installment. The cheque shall be delivered to you in the presence of Sub-Registrar at the time of execution of Islamic Housing Finance Agreement.
Eligibility Criteria:
Age:
Age of applicant and co-applicant/guarantor must be minimum of 18 and maximum of 60 years. However, maximum age allowed for self employed persons would be 65 years.
Co-Applicant / Guarantor :
Primary or three co-applicants/guarantors are allowed.Guarantor must be a family member and with an inheritance rights in the property, to be mortgaged/assigned with HBFC Ltd.
In deserving cases i.e; cases of widows, divorces, issueless couples and unmarried women aged 30 and above, the guarantees of other blood relatives, who do not have inheritable rights in the property, such as brothers, sisters, other adult children (niece and newphew), son-in-law, daughter-in-law etc, may be also accepted.
Race, Caste, Creed :
All Muslim or non-Muslim citizens of Pakistan, Azad Kashmir, Northern Areas.
Income :
The customer should be employed / self-employed and have sufficient repayment capacity to meet the investment obligations;
Proof of income:
Salary Certificate, Affidavit, Tax Return
Property :
Either the customer possesses ownnership of the residential plot upon which house is intended to be constructed or Addition of floors/additional rooms to the house is intended to be raised.
Purchase of house/ flat :
The vendor should have clear and marketable title free from all encumbrances and the house/flat should not be more than 45 years old.House purchase facility is available in Urban areas of District Quarters/Tehsil subject to the condition that construction should be "A" class and all basic amenities of life should be available.
Maximum covered area :
No limit.
Financial Investment:
| Locality Wise Investment Caping | |||||||||||||||||||||
| Repayment Period = Maximum 20 Years | |||||||||||||||||||||
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Head Office:
HEAD OFFICE
Address:
3rd floor, Finance & Trade Centre,
Shahrah-e-Faisal, Karachi, PAKISTAN
Phone
92-21-9202301-05 - Toll free 0800 42325
Fax
92-21-9202360 & 9202319
References:
www.hbfc.com.pk
