House Building Advance is provided to the Central and State Government employees. Under this, employees can get an advance payment for building a house on their land.
New Delhi
has given a big gift to the government employees in the festive season. To overcome the sluggishness of the real estate sector, the government has reduced the interest rate on House Building Advance (HBA) from 8.5% to 7.9%. On September 14, Nirmala Sitharaman announced a reduction in the interest rate.
The Union Housing and Urban Affairs Ministry said that the new interest rate will be effective from 1 October. This rate will be effective for one year. This move of the government is being seen as another step taken towards increasing demand in the residential sector.
The ministry said, “The rate of interest on house building advance for one year for government employees has been reduced from the present 8.5 percent to 7.9 percent. Regardless of the loan amount, interest will have to be paid at the rate of 7.9 percent.
Finance Minister Nirmala Sitharaman said last month that the interest rate on the house building advance would be reduced and would be linked to the returns of 10-year government securities. Sitharaman said, ‘Government employees have a big contribution in the demand for homes. This decision will encourage more and more government employees to buy a new house.
There is a system of giving advance loan in the form of loan for the permanent employees of the government and temporary employees who have been in the fifth quarter continuously for 5 years. House Building Advance is provided to the Central and State Government employees. Under this, employees can get an advance payment for building a house on their land. Under this scheme advance payment is also available for the purchase of a new house or flat. This advance payment can be used in repayment of housing loan.
