Egypt: Mortgage insurance for low-income sector launched
Source: Middle East Insurance Review | Jul 2017
Mortgage insurance is now available to low-income householders who plan to buy their own homes under Egypt’s social housing scheme.
Banks have been reluctant to provide funding to low-income families, arguing that there was no guarantee for such loans. Banks also look for borrowers with fixed incomes in a country where 30% of the working force have regular incomes, according to local media reports.
Under the mortgage insurance policy, the insurance company insures the borrower and pays up the outstanding mortgage loan in case of his death.
Mr Mustafa Abu, an official of the Egyptian Society for Cooperative Insurance, said the new insurance policy will contribute to the growth of insurers, be a guarantee to lenders to expand mortgage finance without worries, and promote real estate and construction in Egypt.
In 2011, after the 25 January Revolution, the Ministry of Housing implemented a project to build one million housing units for low-income individuals. More than six million citizens applied for the housing units. Up till now, about 250,000 units have been built at a rate of 60,000 flats a year. M