Subsidy on enhanced housing loan from April, 2011

The scheme for 1% interest subsidy by central government on housing loans up to Rs 15,00,000  will be available for the borrowers whose loans were sanctioned and disbursed from April this year (2011).

According to RBI (Reserve Bank of India), The new scheme under which the loan limit for interest subvention was raised from Rs. 10 lakh to Rs. 15 lakh, subject to the total housing cost from Rs. 20 lakh to Rs. 25 lakh will remain valid up to March 2012.

With the increase in home loan ceiling, the limit of subsidy for an individual borrower would go up to Rs. 14,865 per year for a loan of Rs 15 lakh from the earlier limit of Rs. 9,910 for a loan of Rs. 10 lakh.

A budgetary provision of Rs 500 crore has been made for the financial year 2011-12 for implementing the scheme.

Loans sanctioned and disbursed between October 1, 2009, and March 31, 2011, are outside the ambit of the new scheme. The interest subvention scheme had started from October 2009.
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