Developer Finance

Developer Finance in Pakistan is very limited. Presently, Primary Mortgage Lenders (PMLs) are providing housing finance to individual in higher income bracket. This excludes majority of population in low and middle income segment that is working in formal and informal sector. Recent development shows Government’s focus on low-cost housing and several measures have been taken by SBP to promote this sector. However, there is shortage in supply side of low-cost housing which has to be met with new projects. With the recent incentives of Government for construction sector, there is huge demand for developer finance. Purpose of this product is to provide funding for development of housing colonies/projects/apartments of entire amount during the tenor for which financing is being extended. PMRC will provide funding to PMLs which will then on-lent to builders/developers.

 

Type of Financing

  • Prefinance

 

*Product Criteria

  • Builder/Developer/team should possess a valid builder/developer license from building control authority, where applicable.
  • Builder/Developer must have at-least 3 years’ experience with good track record
  • There should be a clear and marketable title to the land, free of encumbrances, charges and liens on which the project will be built in case it is offered as collateral by the builders/sponsors

 

Registration certificate of the firm/company

  • Memorandum and Articles of Association/Partnership Deed/Business Charter (in case of Sole Proprietorship)
  • List of the technical staff
  • Pakistan Engineering Council certificate and experience certificates
  • List of recently completed projects (if any), along with copies of Completion Certificates submitted to concerned authorities
  • Any other document(s) required by the bank/DFI

 

Security Structure

Following securities can be considered as collateral for financing:

  • Assignment by way of security of a specific existing Mortgage Loan Portfolio or receivables from builders/developers
  • Any other security as may be required by and is acceptable to the Company such as PIBs & T-bills etc. (Alternate Security) in SGLA Account of PMRC.

 

Tenor

  • Pre-finance 1 to 3 Years
  • Refinance as per weighted average life of portfolio with repricing at agreed frequency

 

Pricing                                                                                                                                                                   

  • Respective tenor PKRV +/- Spread

 

Repayment Frequency

  • Quarterly/Half Yearly

 

* Product Criteria is subject to change.

Low Income Group

Demand for low-income housing is massive however Primary Mortgage Lenders (PMLs) are reluctant to enter this segment due to high risk factor. To encourage PMLs to concentrate in this segment, better discount rates are offered as compared to Business as Usual (BAU) and Middle Income Group (MIG) products. By opting for this product, PMLs are required to generate mortgage loans that meet the eligibility criteria for the low-income segment. Long term fixed rate facility enables PMLs to generate fixed rate, long term mortgage housing finance loans.

Type of Financing

  • Refinance
  • Prefinance

 

*Product Criteria

  • Individual Income: Should not exceed PKR 125,000
  • Household Income: Should not exceed PKR 165,000
  • Loan Amount: Should not exceed PKR 10,000,000

 

Security Structure

Following securities can be considered as collateral for financing:

  • Assignment by way of security of a specific existing Mortgage Loan Portfolio
  • Any other security as may be required by and is acceptable to the Company such as PIBs & T-bills etc. (Alternate Security) in SGLA Account of PMRC.

 

Tenor

  • Pre-finance 1 to 3 Years
  • Refinance as per weighted average life of portfolio with repricing at agreed frequency

 

Pricing                                                                                                                                                                   

  • Respective tenor PKRV +/- Spread

 

Repayment Frequency

  • Quarterly/Half Yearly

 

* Product Criteria is subject to change.

Middle Income Group

Primary Mortgage Lenders (PMLs) penetration is very low in the middle-income group. To encourage PMLs to concentrate in this segment, better discount rates are offered as compared to Business as Usual (BAU) product. By opting for this product, PMLs are required to generate mortgage loans that meet the eligibility criteria for the middle-income segment. Long term fixed rate facility enables PMLs to generate fixed rate, long term mortgage housing finance loans.

Type of Financing

  • Refinance
  • Prefinance

 

*Product Criteria

  • Individual Income: Should not exceed PKR 200,000
  • Household Income: Should not exceed PKR 400,000
  • Loan Amount: Should not exceed PKR 20,000,000

 

Security Structure

Following securities can be considered as collateral for financing:

  • Assignment by way of security of a specific existing Mortgage Loan Portfolio
  • Any other security as may be required by and is acceptable to the Company such as PIBs & T-bills etc. (Alternate Security) in SGLA Account of PMRC.

 

Tenor             

  • Pre-finance 1 to 3 Years
  • Refinance as per weighted average life of portfolio with repricing at agreed frequency

 

Pricing                                                                        

  • Respective tenor PKRV +/- Spread

 

Repayment Frequency

  • Quarterly/Half Yearly

 

* Product Criteria is subject to change.

Business as Usual

This product is designed to refinance existing mortgage loan portfolios of Primary Mortgage Lenders (PMLs). This allows PMLs to leverage their existing mortgage portfolio to generate new mortgage loans. Long term fixed rate facility enables PMLs to generate fixed rate, long term mortgage finance loans.

Security Structure

Following securities can be considered as collateral for financing:

  • Assignment by way of security of a specific existing Mortgage Loan Portfolio
  • Any other security as may be required by and is acceptable to the Company such as PIBs & T-bills etc. (Alternate Security) in SGLA Account of PMRC.

 

Type of Financing

  • Refinance
  • Prefinance

 

Tenor             

  • 3 Years to 5 Years

 

Pricing

  • Respective tenor PKRV +/- Spread

 

Repayment Frequency

  • Quarterly/Half Yearly

Benefits of PMRC Financing

  • Reduced Maturity mismatch – Improved ALM.
  • Reduced Market risk – Fixed rate Loans.
  • Stable source of funding.
  • Reduced Credit Risk- Improved Affordability of Consumer.
  • Borrowings from PMRC are exempted from maintenance/calculation of CRR/SLR
  • Exemption in general provisioning for portfolio refinancing loans from PMRC.
  • Reduced Risk Weightage for PMRC refinanced mortgages.
  • Exemption from real estate lending limits – more exposure for Housing Finance.
  • PMRC’s funding will increase housing finance portfolio of banks thereby creating long term funding source.
  • Banks can cross sell different products to new customers to increase profitability.
  • Leveraging existing portfolio for additional lending.
  • Prefinance option available to generate mortgage loan portfolio.
  • Specialized products for low and middle income segment with price incentive.
  • Mortgage loans portfolios of Pensioners and Govt. employees can be refinanced.
  • PMRC assistance for capacity building and product innovation.
  • Fax
  • +92(21)35633365
  • Registered Address
  • Finance & Trade Center, 4th Floor, Block-A, Shahrah-e-Faisal, Karachi -74400, Pakistan.