House Building Advance : Important Points

1.House Building Advance is admissible to all those temporary employees also, who have rendered 10 years of continuous service.

2.With effect from 27-11-2008.

3.The maximum limit for grant of HBA shall be 34 months' of pay in the pay band.

4.Subject to a maximum of Rs. 7.50 lakh or cost of the house or the repaying capacity whichever is the least, for new construction/purchase of new house/flat.

5.The maximum limit for grant of HBA for enlargement of existing house shall be 34 months' pay in the pay band.

6.Subject to a maximum of Rs. 1.80 lakh or cost of the enlargement or repaying capacity, whichever is the least.

7.The cost ceiling limit shall be 134 times the pay in the pay band.

8.Subject to a minimum of Rs.7.50 lakh and a maximum of Rs.30 lakh relaxable up to a maximum of 25% of the revised maximum cost ceiling of Rs.30 lakh.

9.The rate of interest on House Building Advance is between 5% to 9.5% ,depending on the loan amount.

10.The repaying capacity of Govt. servants who have more than 20 years of remaining service has been revised from 35% to 40% of pay.

CONDITIONS:

The applicant or spouse or minor child should not already own a house in the town/Urban agglomeration where the house is proposed to be constructed or acquired.

b) The title to the land should be clear. The land may be owned either:
- by the Government employee; or
- jointly by the Government employee and spouse.

COST CEILING:

134 times of pay in the pay band subject to a minimum of Rs. 7.50 lakh and a maximum of Rs.30 lakh (Cost of the house, excluding cost of land should not exceed 134 times of the Basic Pay excluding Grade Pay)

Administrative Ministry may relax the cost ceiling to 25% of cost ceiling mentioned above in the individual cases on merits.

Effective from 27th November, 2008.

Eligibility, Purposes and Conditions as follows...

If both husband and wife are Government Employees, Advacne is admissible to only one of them.

Acquiring a plot and constructing a house thereon.

Enlarging living accomodation in an existing house owned by the employee or jointly with spouse. The total cost of the existing structure (excluding cost of land) and the proposed additions should not exceed the prescribed cost ceiling.

Purchase of house / flat under "Self - Financing Housing Scheme and " Co-operative Group Housing Societies".

For purchase of houses / flat from private parities, i.e., registered builders, architects, house building societies, etc., but not from private individuals.

If GPF withdrawl is also taken for house building, the total amount of GPF withdrawl and the House Building Advance should not exceed the cost-ceiling limit.

House / Flat constructed / acquired with the help of HBA to be used for residential purpose only.

The advance will be limited to the estimated cost of consturction.

Only one advance is admissiable during the entire service.

The amount of advance shall be restricted to the repaying capacity of the employee.

The amount of advance sanctioned can be reduced at the request of the employee to avail of the reduced rate of interest, if the entire advance has not been drawn.

For purchase / Construction of flat or Purchase of a house the amount of advance sanctioned in one lumpsum.

The construction should be exactly according to the approved plan and specification.

The consturction should be completed whithin 18 months of the dateon which the first instalment is drawn.

On completion of construction/purchase, the house should be insured by the employee at his cost against fire, flood and lightning for the full value of the house.

No interest is chargeable beyond the date of reirement/ death of the government employee.

The rate of interest will be reduced half per cent for an employee who undergoes sterilization(family planing).

The entire amount of advacne together with interest is repayable in 20 years. 180 monthly instalments for principal and 60 instalments for interest.

Recovery will commence from the pay for the month following that in which advance is taken.