The Biz Update One of Pakistan's Most Reliable Business News Website
Related Articles
Karachi: The State Bank of Pakistan (SBP) has introduced additional facilitative measures under its housing finance program to improve access to loans and streamline the approval process for prospective borrowers.
Under the revised framework, the central bank has capped the debt burden ratio at 65 percent, requiring that total monthly amortization payments, including housing finance and all other consumer loan obligations, must not exceed 65 percent of a borrower’s net disposable income. The move aims to promote responsible lending while allowing greater flexibility for applicants.
The SBP has also simplified property assessment procedures. For properties with a market value of up to Rs5 million, banks and the House Building Finance Company Limited (HBFCL) are now permitted to conduct valuations using their internal resources. However, properties exceeding Rs5 million must be evaluated by at least one valuator from a panel approved by the Pakistan Banks’ Association (PBA), ensuring transparency in higher-value transactions.
In a key step to reduce delays, banks and HBFCL have been directed to complete the credit approval process within a maximum of 15 working days from the receipt of a complete application under the scheme.
The central bank further clarified that, for the purpose of this program, certain prudential regulations related to housing finance have been relaxed to the extent of these new measures. Banks and HBFCL have been instructed to ensure strict compliance with the updated guidelines.
The initiative is expected to accelerate housing finance disbursement and support broader access to affordable housing across the country.
