New Delhi, Jan 8 (PTI) The government is in the process of setting up a mortgage guarantee fund which will cover the risk of home loans given to the poor by banks and housing finance companies, Minister of Housing and Urban Poverty Alleviation Kumari Selja said today.
"Housing finance companies (HFCs) and banks hesitate to serve the low-income market for a variety of reasons such as inability to assess credit worthiness, uncertain cash flows and lower profits," she said while addressing the national convention of the National Real Estate Development Council.
Noting that involvement of banks and HFCs is essential to bridge the huge housing deficit, Selja said the ministry is planning to set up a guarantee fund for removing the fears of banks and HFCs in providing loans to the economically weaker sections (EWS) and the low income groups (LIG) of the society.
