LET FLISP HELP YOU BUY YOUR DREAM HOME

THE GOVERNMENT-backed Finance Linked Individual Subsidy Programme (Flisp) helps first-time buyers in the so-called “gap” market to buy their own homes.

This market is made up of those who earn too much to qualify for a free government home but too little to buy without some form of financial help.

The subsidy is open to those with a combined gross household income of between R3 501 and R22 000 who meet the qualifying criteria, says Meyer de Waal, director of MDW Inc Attorneys, one of the founding members of the Attorney Realtor Hub and Flisp assistance services.

The subsidy ranges from R27 960 to R121 626 and is calculated on a sliding scale, according to the buyer’s income.

To qualify the buyers must:

• Have their home loan approved.

• Be South African citizens and over 18.

• Be married, co-habiting or single with a dependent.

• Never have benefited from a similar subsidy before, for example an RDP house.

How can the subsidy be used?

It can be used to pay for a home loan deposit or to decrease the size of a loan. If the subsidy is used as a deposit, a smaller home loan can be applied for. For example, a R50 000 subsidy on a R600 000 home means the home loan amount need only be R550 000.

The subsidy can also be used to increase the purchasing power of the buyer. For example a R50 000 Flisp subsidy added to a R600 000 home loan allows the buyer to purchase a home for R650 000.

De Waal explains purchasing a home with a Flisp subsidy:

Establish if you qualify.

• Establish the home loan amount you will qualify for. Without an approved home loan you cannot get access to a Flisp subsidy.

• Get your home loan prequalification estimate and add that to your Flisp subsidy amount. This

will be your home buyer power. Do not forget to budget for transfer and bond registration costs.

• Start your property search according your budget. When you find a property you can afford, sign an offer to purchase, using your pre-approval certificate and Flisp subsidy as a guide.

• Apply for the home loan.

• Apply for the Flisp subsidy. As soon as the home loan is approved you can submit your application. You can apply directly to the Department of Human Settlements in the Western Cape and Free State as well as to the National Housing Finance Corporation if you live in Gauteng or KZN. You can apply directly or through accredited service providers.

• Submit the offer to purchase to the Flisp office for submission to the banks for final bond approval.

• The government will issue a guarantee to the transferring attorneys once the Flisp subsidy is approved or it can be paid directly in the home loan account.

He adds: “A home loan Flisp affordability calculator is available at www.flisp.co.za. Buyers should also check their financial health and what bond they qualify for at https://FLISP.mybondfitness.co.za.

The Flisp subsidy assists first-time buyers in the ‘gap’ market to buy their own homes. PICTURE: GABRIELLE HENDERSON/UNSPLASH