FLISP enables qualifying beneficiaries to reduce the initial mortgage loan amount or augment the shortfall between the qualifying loan and the total house price

Finance Linked Individual Subsidy Program, better known as FLISP, was developed by the Department of Human Settlements to enable sustainable and affordable first time home-ownership opportunities to South African citizens and legal permanent residents earning between R3 501 and R15 000 per month, (the “affordable” or “gap” market).

Individuals in these salary bands generally find it hard to qualify for housing finance; their income is regarded as low for mortgage finance, but too high to qualify for the government “free-basic house” subsidy scheme.

FLISP Summarised

FLISP enables qualifying beneficiaries to reduce the initial mortgage loan amount or augment the shortfall between the qualifying loan and the total house price.

Qualifying Criteria for FLISP:

  • RSA citizen or Permanent Resident
  • Over 18 years and competent to legally contract
  • First time Housing Subsidy Scheme beneficiary
  • Have an Approval in Principle for a Home Loan
  • Monthly Income from R3 501 to R15 000
  • The once-off FLISP subsidy amount ranges between R20 000 and R87 000, depending on monthly income.

FLISP may be used for the following:

  • Buy and existing, new or old, residential property
  • Buy a vacant serviced residential-stand; or
  • Build a residential property

3 types of FLISP

  1. Deposit
  2. 100% Bond
  3. Already taken Transfer

1. Deposit – Increase Price

  • Max qualify for R350 000
    – FLISP subsidy required as a deposit
    – FLISP                              +  R    60 000
    – Bond Approved        +  R 350 000
    – Purchase Price              R 410 000
  • Development property
  • All costs included in the purchase price
  • Max qualify for R350 000
    – FLISP subsidy required as a deposit
    – FLISP                                 R 350 000
    – Bond Approved       –  R    60 000
    – Purchase Price         –  R 290 000 R0.00

2. 100% Bond

100%

  • Purchase price                          R 350 000
  • Balance bond required      – R 350 000
  • Development property
  • All costs included in the purchase price
  • FLISP paid back into home load to reduce the capital amount R350 000 – R60 000 = R290 000

2. Retrospective

After Transfer

  • Purchase price                          R 350 000
  • Bond registered        R 350 000
  • Already taken transfer
  • 3-12 month “window opportunity to submit FLISP claim
  • FLISP paid back into home load to reduce the capital amount R350 000 – R60 000 = R290 000
  • NB – Each Province who approves FLISP has their own timeline for retrospective FLISP applications.