Ministry of Housing & Urban Affairs on Thursday reduced the rate of interest on House Building Advance [HBA] from existing 8.5% to 7.9% for a period of one year, irrespective of the loan amount of HBA.
This will be with effect from October 1, 2019.
In September 2019, in order to encourage government servants to buy houses, finance minister Nirmala Sitharamam, announced lowering of interest rate on house building advance and linked with the 10-years government securities yields.
HBA is available to central government and state government employees for constructing a new house on the plot owned by the employee or jointly with the spouse. The scheme can also be availed for the purchase of new house or flat.
HBA is admissible to permanent employees and all those temporary employees also who have rendered five years of continuous service.
The ministries/departments are delegated powers to sanction HBA to their employees in accordance with the rules.
The scheme of HBA to central government employees is aimed as a welfare measure providing assistance to the government employees to construct/acquire house/flats of their own.