What is " reverse mortgage" scheme?
What is " reverse mortgage" scheme?
REVERSE MORTGAGE: Section 10(43)
The periodic installments or lump sum paid by the lender to the borrower during his lifetime will be exempt from tax.
Where a senior citizen who owns a house property does not have regular source of income, can mortgage his property with a scheduled bank or a housing finance company (the lender).
The lender in turn pays periodic installments or lump sum to the borrower during the lifetime. The borrower can continue to stay in the property during his life time and as well continue to receive regular income from the lender. The lender will recover the loan along with the accumulated interest by selling the house after the death of the borrower.
Hi pratik,
Reverse mortage scheme is basically for Senior citizen , it is basically opposite of mortage scheme. In which a person mortage his property to bank forever and in return bank will pay a sum fixed to a person every month till any partner ( you / wife ) survive. At the end bank will sell that property and recover the amount.
With Regards,
Narendra Gupta.
CAclubindia
