House Building Advance for Central Government Employees – Amendment to Latest HBA Rules 2017

House Building Advance for Central Government Employees after implementation of 7th Pay Commission recommendations – Latest amendment to HBA Rules 2017

After implementation of 7th Pay Commission recommendations Govt has come up with a reasonable Loan amount Limit that can be sanctioned to Central Government Employees

Checkout this Office Memorandum I.17011/11/-H-III dated 09.11.2017 issued by Govt implementing House Building Rules (HBA) – 2017

Certain important aspects of HBA Rules 2017 which are beneficial to the employees are: 

1. HBA maximum Limit has been increased to Rs. 25 lakh from Rs. 7.5 lakh. Maximum House Building Advance on the basis of pay of the employee still exists.
2. A Central Government Employee would be entitled to a housing loan equal to 34 months of basic pay or Rs. 25 lakh or cost of house / construction or amount equal to repaying capacity which ever is the least
3. For expansion of house, HBA is limited to Rs. 10 lakh or 34 months of pay of employee or cost of expansion which ever is the least
4. The ceiling of cost of house / construction for which loan is to be obtained has been increased from Rs. 30 lakh to Rs. 1 Crore
5. Both Husband and wife are entitles to avail HBA jointly or separately. Until now only one of the spouses was entitled to HBA
6. Rate of Interest for HBA is 8.5%. Earlier it was 6% to 9.50%.
7. Another important change in House Building Advance after implementation of 7th pay Commission is the practice of adding additional interest of 2.5% along with regular interest of 9.5% has bee withdrawn.  Earlier additional interest was charged for fulfilling certain obligation by employee such as renewal of insurance till entire repayment loan and interest etc. Once the all the obligations successfully fulfilled by the employee, the additional interest levied would be repaid to employee as rebate.

Now, Govt has issued an amendment OM dated 01.08.2018 for amending Para 2(i) of the HBA Rules 2017 to provide that HBA will be allowed when clear title is available in respect of land in the name of self or spouse in which a government employee constructs House.

1-17011/6(3)/13/2018-H.III
Government of India
Ministry of Housing & Urban Affairs
Housing-III Section

Nirman Bhawan, New Delhi
Dated 1.08.2018.

OFFICE MEMORANDUM

Subject : Clarifications regarding House Building Advance — reg.

The undersigned is directed to say that in partial modification to the Ministry of Housing & Urban Affairs OM No. 1.17011/11(4)/2016-H.III dated 09.11.2017 regarding House Building Advance Rules — 2017, the competent authority has approved to modify the provision of para 2(i) in place of the existing provision.

2. Para 2(i) may be read as under:

“Constructing a new house on the plot owned by the employee or the employee and the employee’s wife/husband jointly with the clear title of the plot”

3. All the other existing provisions in the said OM of even no. dated 09.11.2017 shall remain same.

(Shailendra Vikram Singh)
Director (IFD)

Read/Download Ministry of Housing & Urban Affairs OM dated 1st August 2018.

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