HBA
– House Building Advance
· Significant changes were made in the HBA for
Govt employees due to acceptance of 7th Pay Commission.
· Here are some important changes compared to
previous rules
|
SN
|
Item
|
6th PC
|
7th PC
|
|
1
|
Maxmimum HBA Amt
|
7.5 Lakhs
|
25 Lakhs
|
|
2
|
Interest Rate
|
8.5%
|
6% to 9.5% for different slabs
|
|
3
|
Expansion of House
|
1.8 lakhs
|
10 lakhs
|
|
4
|
Cost ceiling limit of the House
|
30 Lakhs
|
100 Lakhs ( with a proviso of
upward revision of 25% in deserving cases i.e., up to 125 Lakhs)
|
|
5
|
If both spouses are Govt employees
|
Only one spouse is eligible
|
Both spouses are eligible either
jointly or separately
|
|
6
|
Provision of 2.5% higher interest
rate above the prescribed rate
|
Existed
|
Withdrawn
|
Salient features of
HBA (after 7th PC)
· HBA amount: Least of Rs. 25 Lakhs or 34 months basic pay or cost of House/Flat or Repaying capacity.
· Expansion of House: Least of Rs.10 Lakhs or 34 months Basic pay or cost of
expansion or repaying capacity.
· Cost ceiling limit of the House - Rs.1 Crore ( with a proviso of upward revision
of 25% in deserving cases i.e., Rs.1.25 Crores)
· Both spouses, if they are Govt employees are now
eligible for HBA either jointly or separately.
· Migration: Provision of migration of existing Housing loan
from financial institutions/Banks to HBA is existed.
· Second Charge: Availing Second Charge on the house for taking
loans to fund balance amount from Banks/financial institutions has been
simplified. No Objection certificate will be issued along with the sanction
letter of HBA, if employee applied.
· Simple interest rate 8.5%
· HBA is admissible to an employee once in a
life time.
· Penalty provision (for not complying the
conditions) of 2.5% (higher rate of interest) is withdrawn
· Recovery of HBA: Principle in 180 months (15 years) and Interest in 60
months (5 years)
· The House/flat can be insured with the private
insurance companies which are approved by IRDA – Insurance Regulatory
Development Authority.
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