Maldives Pension Administration Office (MPAO) signed with Bank of Maldives Ltd (BML) to provide home financing loans to clients of MPAO’s Maldives Retirement Pension Scheme via the nation’s bank.
The CEOs of MPAO and BML, Mohamed Manik and Andrew Healy respectively, signed the agreement on Tuesday evening at a special ceremony held at BML’s head office.
Speaking to reporters afterwards, BML’s CEO Andrew Healy announced that pensioners can now acquire houses under the bank’s Home Loans from August 9 onwards. He declared that MPAO’s new policy has made equity loans more accessible.
MPAO’s CEO Mohamed Manik stated that their latest venture is the fruit of two years’ labour, finally brought to pensioners with the new amendments to the Pension Act.
Under MPAO and BML’s new agreement, applicants for BML’s Home Loans may convert their savings from their retirement savings account to equity for the loan. The money will be collateralised by MPAO during the loan period. In the circumstance where the collateralised money from pensioners’ accounts be insufficient for the total equity, the loan applicants are to reimburse the remaining amount from their own pockets.
Loan applicants may also combine the money from retirement savings accounts of other family members as equity for the loan.
BML’s Home Loans are offered with 20 percent equity and 10 percent interest with a repayment period of 20 years. With increased equities to 30 percent, 40 percent or 50 percent , interest rates are dropped to 9.75 percent, 9.50 percent and 9 percent respectively.