# If you cannot repay: what happens to your home and your pension

> Under the Pension Office's housing scheme, a lender must sell the home first. Your pledged pension is used only if the sale does not clear the loan. The order of events, a worked example, and what to do before it comes to that.

Source: Maldives Real Estate News, published by Binga Properties. URL: https://news.binga.mv/pension-housing-loan-default-what-happens
Published: 2026-10-18T15:57:47.286Z · Updated: 2026-10-18T15:57:47.286Z · Event date: 2026-10-18

Nobody buys a flat planning to default. But a pledged pension is still your retirement money, so it is worth knowing the order of events.

## The rule

The Pension Office: *"On default of a loan obtained through this scheme, the initial course of action will be to sell the housing unit… If the amount received through the sale of the housing unit is insufficient to recover the loan amount, the balance amount required to settle the loan will be released from the collateralized amount to the loan issuer."*

So:
1. **The home is sold first.**
2. **The sale proceeds go to the loan.**
3. **Only any shortfall** is taken from your pledged pension.
4. **Whatever is left** of the pledged amount should return to your RSA. Confirm this with your lender, as the Pension Office does not spell it out.

## A worked example

You owe **MVR 2.1 million**, with **MVR 400,000** pledged from your pension.

- The flat sells for **MVR 2.3 million**. The loan is cleared and **your pension is untouched**.
- The flat sells for **MVR 1.9 million**. The **MVR 200,000** shortfall comes from your pension. **MVR 200,000** of the pledge remains.
- The flat sells for **MVR 1.6 million**. The **MVR 500,000** shortfall uses all **MVR 400,000** of your pension. You may still owe the lender **MVR 100,000**, plus any sale costs and fees.

*Illustrative figures. A forced sale often fetches less than a normal one, and fees and arrears add to what is owed.*

## Before it comes to that

- **Talk to your lender early.** Most lenders can reschedule a loan. HDFC, for example, lists a restructuring fee of MVR 1,500.
- **Keep the home insured.** Most lenders require cover for the whole term.
- **Leave a margin.** Choose a payment that would still be affordable if your income fell.

Pension Office: hotline **1441**, Viber **733 1441**, info@pension.gov.mv, pension.gov.mv. Your pledgeable amount is on your RSA statement, in the Pension mobile app and on the website.

*From the Maldives Pension Administration Office's own housing pages, FAQ and leaflet, read on 18 October 2026. Your lender's terms decide the rest; confirm them before you commit. General information, not financial advice.*

## Sources
- pension.gov.mv/en/housing (Pension Office, MRPS Housing Benefit, read 18 October 2026) (https://pension.gov.mv/en/housing (Pension Office, MRPS Housing Benefit, read 18 October 2026))
- pension.gov.mv/en/faq/housing (Pension Office, housing FAQ, read 18 October 2026) (https://pension.gov.mv/en/faq/housing (Pension Office, housing FAQ, read 18 October 2026))
- storage.googleapis.com/staging.mpao-1327.appspot.com/strapi/Housing_Leaflet_f46c9c774e/Housing_Leaflet_f46c9c774e.pdf (Pension Office housing leaflet, HL/V1/SEP22, Dhivehi) (https://storage.googleapis.com/staging.mpao-1327.appspot.com/strapi/Housing_Leaflet_f46c9c774e/Housing_Leaflet_f46c9c774e.pdf (Pension Office housing leaflet, HL/V1/SEP22, Dhivehi))

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