FLISP was developed to enable first-time home-ownership to households in the ‘affordable or gap’ market, that is, people earning between R3 501 and R22 000 per month, as a basic salary. Individuals in these salary bands generally find it hard to qualify for housing finance; their income is regarded as low for a home loan (mortgage or pension/provident backed loan), but too high to qualify for the government ‘free-house’ subsidy scheme.

Depending on the applicant’s gross monthly income, their once-off FLISP subsidy qualifying amount may vary between R38 911,40 – R169 264,60

Applicants intending to acquire residential property may apply to FLISP if they meet the following qualifying criteria:

• Your monthly household income is between R 3501 and R 22 000 basic salary per month;
• If you are a South African citizen or have a permanent residence permit;
• You have never received a government housing subsidy before;
• You have never owned a fixed residential property before
• You are competent to form a contract – over 18 years of age.

You are either:

• Married – applicant and spouse must apply together 
• Single with financial dependent(s)**

**A financial dependent refers to any person who is financially dependent on the applicant and who resides permanently with the applicant for example:  

– children under the age of 18 years i.e. grandchildren, adopted children, foster children, biological children or, if older, are proven financially dependent on the applicant;

– biological parents or parents-in-law, grandparents or grandparents-in-law;

– brothers and sisters under 18 years or, if older, are proven financially dependent on the applicant;

– extended family members who are permanently residing with the applicant due, for example, to health problems and who are proven to be financially dependent on the applicant

FLISP DOCUMENT REQUIREMENTS:

The following CERTIFIED COPIES are required as supporting documents when applying for FLISP:

• RSA Bar-Coded Identity Document (ID)
• Bar-coded Permanent Residence Permit (where applicable)
• Birth Certificates/RSA ID’s of all financial dependents (where applicable)
• Proof of Foster Child Guardianship (where applicable)
• Marriage Certificate (where applicable)
• Final order of divorce (where applicable)
• Spouse’s Death Certificate (where applicable)
• Proof of Income
• Home Loan Approval in Principle/Grant letter from an accredited Lender i.e., Absa, FNB, Nedbank, Standard Bank or SA Home Loans.
• Agreement of sale
• Building Contracts and Approved Building Plans (where applicable)
• Statement of transfer costs from conveyancer showing transfer and bond registration costs (where applicable).

Omega Property and Finance will complete the application on your behalf, please chat with your consultant or email sales@omegaproperty.co.za

 

HOW CAN FLISP ASSIST ME?

FLISP REDUCES

The initial home loan amount, making monthly loan repayment installments affordable (payment made to home loan account).

FLISP AUGMENTS

The shortfall between the qualifying loan amount and the total product price (payment made to transfer attorneys).

SUBSIDY QUANTUM – Example 1

 Based on an R9 000 basic salary p/m income band, where the individual after the Lender/Bank’s credit and affordability assessment, based on the National Credit Act (NCA) criteria, qualified for R300 000 home loan:

FLISP REDUCES the home loan (mortgage or pension/provident backed loan) amount to render the monthly loan repayment installments affordable; (payment made to home loan account)

Property Price: R300 000
Bank HL Approval: R300 000
Less FLISP as a deposit: R130 149
EVENTUAL HOME LOAN AMOUNT: R169 851

SUBSIDY QUANTUM – Example 2 is based on an R9 000 basic salary p/m income band, where the individual after the Lender/Bank’s credit and affordability assessment, based on the National Credit Act (NCA) criteria, qualified for R206 474 home loan:

FLISP AUGMENTS shortfall between the qualifying loan amount and the total product price; (payment made to transfer attorneys)

Property Price: R300 000
Bank HL Approval: R206 474
FLISP for HL top-up: R130 149
EVENTUAL HOME LOAN AMOUNT: R263 377

FLISP subsidy is for residential properties in formal towns, where transfer of ownership and registration of mortgage bonds is recordable in the Deeds Office.

How To Apply For FLISP

Once the lender grants the home loan approval or ‘approval in principle’, the applicants, developers, or estate agents complete the FLISP application form.

All completed applications, together with all required supporting documents, are submitted to our Subsidy Administration Section for processing.

Applications are processed on the Housing Subsidy System, where several checks are done against various databases to confirm eligibility.

WHAT HAPPENS IF THE FLISP APPLICATION IS APPROVED / DECLINED?

If the FLISP application is declined, then the process may continue with the home loan transaction without FLISP, in accordance with the Lender/ bank’s terms and conditions.

If the FLISP application is approved, then the department issues a letter of undertaking to confirm the approval, the subsidy amount, and the payment procedure.

HOW IS THE FLISP SUBSIDY PAID?

In instances where the FLISP subsidy augments the shortfall between the qualifying home loan amount and the house purchase price, the subsidy disbursement/payment will be made into the transferring Attorney’s trust account on notice of readiness to lodge the transfer documents.

In the instance where the FLISP subsidy reduces the principal home loan amount, rendering loan repayment installments affordable, the subsidy disbursement/payment will be made to the financial institution for payment directly onto the beneficiary’s home loan account.

In the instance where the applicant received a 100% home loan, or the full purchase price is accounted for, the applicant can request for the transfer and/or bond registration fees to be paid from the housing subsidy.

FLISP SUBSIDY BANDS

How much FLISP do I qualify for? Depending on the applicant’s gross household monthly income, the FLISP amount they qualify for may range from R38 911,40 – R169 264,60. The following tables indicate the FLISP low and high bands: