merisarkar news service.
New Delhi, September 30, 2009
In a big relief to small home loan borrowers the union government has decided to provide 1 per cent interest subvention. This scheme would be applicable to individual housing loans upto Rs. 10 lakhs. Borrowers can avail this scheme for housing units costing upto Rs. 20 lakhs.
The government thinks that cut in applicable interest would result in reduced EMIs for small borrowers and this step would create more demand for low cost housing.
The Finance ministry said in a statement, "The Scheme will cover all regions of the country and support the low and middle income sections of society to become house owners."
The scheme is also expected to give a boost to credit flow to the housing sector and create additional employment in real state and allied sectors, such as steel and cement.
Finance Minister Pranab Mukherjee announced in the Lok Sabha in July, 2009 that housing needs of lower and middle income class needs to be supported. He also announced allocation of Rs. 1,000 crore as a interest subsidy for a period of one year for this purpose.
The scheme will be in operation for a period of one year starting from 1st October 2009 to 30th September 2010.
