The Department of Local government & Human Settlements has recently introduced Finance Linked Individual Subsidy Progamme (FLISP) to various communities and government employees throughout the province. FLISP allows qualifying beneficiaries to reduce the initial mortgage loan amount or augment the shortfall between the qualifying loan and the total house price bringing the eventual home loan instalment to an affordable amount over the loan repayment period.
The Government has been mandated to create sustainable human settlements and improved quality of household life. Therefore FLISP was introduced as one of the many housing programmes of government to benefit those who do not qualify for low cost houses. It is specifically intended for the market segment whose income is inadequate to qualify for a home loan, but exceeds the maximum limit applicable to access Government's 'free basic house' subsidy scheme. This market segment, generally known as the 'affordable/gap' market, earns between R3 501 and R15 000 per month.
In order to qualify for the subsidy, an applicant should be a South African citizen or permanent resident with valid identity document and first time home buyer with a clean credit record. Depending on the gross household income, the once-off subsidy amount may vary between R10 000 and R87 000 and it is not paid direct to the applicant’s account.
During the recent session with the government officials in Bojanala District Municipality, MEC for Local Government & Human Settlements, Collen Maine, warned the officials that the subsidy will not be paid into their personal banking accounts. “When you apply for the subsidy, we deal with the bank and not the individuals. The money will be paid to the bank that will be funding your bond to guarantee certainty that the subsidy will be for the intended purpose; which is building a house. We don’t want you to go buy clothes, expensive cars with that subsidy”, Maine advised.
“The department has mandated the National Housing Finance Corporation (NHFC) to be the agent of FLISP in ensuring a sustainable supply of affordable housing stock, which means, it will secure participation of the major banks as far as home loan application is concerned”, said Maine.
Awareness around FLISP will continue to be created all over the province in order to reach out to the people and ensure that they are clued up about the government programmes and benefits as far as housing is concerned.
Enquiries:
Ben Bole
Cell: 071 566 1399
