Documentation eased: SBP amends its housing finance PRs
- The amendments have been introduced to facilitate customers availing housing finance
The State Bank of Pakistan has amended housing finance regulations, simplifying property documentation and standardizing mortgage procedures to facilitate borrowers and promote renewable energy financing.
- Simplified property documentation for housing finance.
- New mortgage procedures and flexibility for loans up to Rs5 million.
- Renewable energy financing and Green Property Certificate acceptance.
KARACHI: The State Bank of Pakistan (SBP) has amended its Prudential Regulations for housing finance to simplify property documentation requirements, facilitate borrowers and standardize procedures for creating mortgages.
According to a circular issued by the SBP, in order to facilitate the customers availing Housing Finance, the documentation for creation of mortgage as required under PR HF-7 (Title Documents and Security Arrangements) has been amended.
The amendments have been introduced to facilitate customers availing housing finance by simplifying and standardizing documentation requirements for the creation of mortgages.
As per revised Prudential Regulation HF-7, banks and Development Finance Institutions (DFIs) will be required to obtain only title and ownership-related property documents listed by SBP to secure housing finance.Upon receipt, the bank and DFI will give the borrower a signed acknowledgement listing all title and property documents received.
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The SBP has further clarified that a house, apartment or plot financed by a bank or DFI must be mortgaged in favour of the lending institution through an equitable or registered mortgage.
However, for housing finance of up to Rs5 million, banks and DFIs may extend financing by marking a lien on the property in the records of the relevant land-record authority.
The SBP has also provided flexibility for renewable-energy financing, allowing banks and DFIs to extend such financing without any security or against the hypothecation of installed assets, including solar panels, inverters, batteries and related equipment.
Further, housing finance may be extended against Green Property Certificate issued by government of Punjab or an equivalent certificate issued by the competent authority in other provinces.
As these certificates comprehensively verify title, ownership and possession, properties for which such certificate has been issued do not require the submission or presentation of any additional ancestral historical or separate ownership document, the SBP clarified.
The SBP has advised all banks and DFIs to ensure strict compliance with the revised Prudential Regulations. All other instructions contained in the earlier circular will remain unchanged.
Copyright Business Recorder, 2026
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