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Revision of Housing Loan qualifying Limits for Priority Sector Lending

Revision of Housing Loan qualifying Limits for Priority Sector Lending


Beside the policy decision to hike the Repo rate by 25 bps, RBI on Wednesday (06.06.2018) revised the housing loan limits for priority sector lending from existing limit of Rs.28 lakhs to Rs.35 lakhs in Metropolitan Centers provided the overall cost of dwelling unit does not Rs.45 lakhs. The limit for other centers for classification of priority sector lending is increased from existing limit of Rs.20 lakhs to Rs.25 lakhs provided the overall cost of dwelling unit does not Rs.30 lakhs.

The default rates in housing loans below Rs.35 lakhs are low in comparison with other segments of Priority sector advances. RBI decision to hike qualifying amount for home loans is expected to galvanize lenders increase their market share in the segment.

Pradhan Mantri Avas Yojana:

Besides, revision in loan limit for priority sector, the existing family income limit of ₹ 2 lakh per annum,  for loans to housing projects exclusively for the purpose of construction of houses for Economically Weaker Sections (EWS) and Low Income Groups (LIG), is revised to ₹ 3 lakh per annum for EWS and ₹ 6 lakh per annum for LIG, in alignment with the income criteria specified under the Pradhan Mantri Awas Yojana.

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