What you need to know about the government subsidy for first-time home buyers
From which individuals qualify for the subsidy to how to apply, we answer the most common questions about the Finance Linked Individual Subsidy Programme (FLISP).
Are you thinking of buying your first property? Then why not take advantage of the Finance Linked Individual Subsidy Programme (FLISP), a government initiative aimed at helping first-time home buyers.
FLISP is a programme by the Department of Human Settlements and NHFC which was started in 2012. It is aimed at helping first-time homebuyers who don't earn much or need to raise money for a deposit.
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Who qualifies?
According to FLISP's website, individuals must meet the following criteria in order to qualify:
- You must be a South African citizen or be in possession of a valid permit.
- You must be a first-time home buyer.
- Your monthly household income needs to be between R3,501 and R22,000 per month.
- You must have a pre-approved home loan from the bank / qualify for a loan from a Lender (Bank).
- You must be married, cohabiting or single with a dependant.
- You must not be a beneficiary of a previous or another government housing programme subsidy.
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How much will your subsidy amount be?
The loan amount can be any amount from R27,960 to R121,626.
Click here for the Subsidy Amount Calculator which will tell you much subsidy you will qualify for.
How to apply for the subsidy?
- To apply for the subsidy, you need to visit your local Department of Human Settlement office.
- You can also apply via the FLISP's website which will guide you through the process.
You will be asked the following:
1. Is your total household basic income [you and your spouse/partner] between R3,500 and R22,000 per month [before deductions].
2. Do you have any dependents? Spouse or Child.
3. Have you ever received a subsidy for a home before?
4. Is this the first home registered or to be registered in your name?
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How long does the application take?
The application process takes approximately seven working days.
If you need the money for the deposit, it will be paid into your account within five working days from the date of lodgement at the deeds office. If you don't need the money for the deposit, it can be paid after registration.
So, the payment depends on what you need the subsidy for.
Do you need to pay back the money?
The subsidy is not a loan, but it is money that is given for free to the public to help first-time home buyers.
However, according to the FLISP's website, if you resell your property before eight years, there are certain conditions applicable, the main condition is that the portion of the FLISP Subsidy is to be refunded by the seller.
If you resell the property within a year, you will need to pay back 90% of the subsidy amount. The amount decreases by ten per cent each year. This means, if you sell it in the eighth year, you will need to pay back twenty per cent of the money.
For more information, contact https://www.flisp.co.za/.
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