The State Bank of Pakistan has directed commercial banks and the House Building Finance Company Limited to speed up the processing of home loan applications under the government’s housing finance scheme.
According to a newly issued circular, financial institutions must now complete credit decisions within 15 working days after receiving a complete application. This move is aimed at making housing finance more accessible and efficient for Pakistani citizens who have long faced delays in loan approvals.
To further streamline the process, the SBP has relaxed property valuation requirements. For properties valued at up to Rs. 5 million, banks and HBFCL can rely on their internal assessments instead of external evaluations. However, for properties exceeding this value, at least one valuation must still be carried out by an appraiser approved by the Pakistan Banks’ Association.
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The central bank has also updated eligibility criteria to ensure responsible lending. Under the revised rules, a borrower’s total monthly loan repayments—including housing loans and other consumer financing—must not exceed 65% of their net disposable income. This condition is designed to prevent excessive financial burden on borrowers while maintaining stability in the banking sector.
Meanwhile, the government has rebranded the housing initiative as the “Wazir-e-Azam Apna Ghar Program – Ghar Ho Tu Apna,” replacing its previous title. The program aims to support individuals and families in owning or building homes with affordable financing options.
Under this scheme, eligible applicants can secure loans of up to Rs. 10 million at a subsidized flat interest rate of 5%. The financing can be used either to purchase a house or to construct one on land already owned by the applicant.
This initiative is expected to boost the housing sector, create employment opportunities, and help thousands of Pakistanis achieve the dream of homeownership with faster, simpler, and more transparent processes.
