What is FLISP and how to apply for it

July 14, 2023

In South Africa, the dream of homeownership can often seem out of reach for many individuals and families. However, there are initiatives in place to help make this dream a reality, and one such program is the Finance Linked Individual Subsidy Program (FLISP). This article aims to provide a comprehensive understanding of what FLISP is and guide South Africans on how to apply for it.

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First-time homebuyers can qualify for a government housing subsidy of up to R121,626.

What is FLISP?

The Finance Linked Individual Subsidy Program (FLISP) is a government initiative introduced by the South African Department of Human Settlements. Its primary goal is to provide financial assistance to first-time homebuyers who fall within the low- to middle-income brackets. FLISP aims to bridge the affordability gap by offering a subsidy to eligible individuals, enabling them to access housing finance and purchase their own homes.

Did you know if you earn between R3 501 and R22 000 per month you qualify for a housing subsidy? For most of us, we cannot afford to buy or build our dream home but with FLISP we have a fighting chance to own our dream house. The FLISP Housing Subsidy Programme is aimed to make homeownership a reality for first-time home buyers.

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Here are the ones and twos you need to know about FLISP:

The Finance Linked Individual Subsidy Programme (FLISP) is a subsidy established by the government that aims to provide the poor and the low to middle-income households with access to adequate housing.

Qualifying households for this subsidy are those in the gap market that is – those that do not qualify for a fully subsidised house and at the same time do not qualify for mortgage loans from the banks. These are families earning between R3 501.00 and R22 000-00 per month.

Persons who in the past could not qualify for FLISP due to them not qualifying for a home loan or mortgage will now be able to use other sources of finance to acquire a property. Residents with a household income of R3 501 to R 22 000 a month will be able to access FLISP through a pension/provident fund loan, a cooperative or community-based savings scheme (stokvel).

Individuals who are unable to secure a mortgage loan may apply for the allocation of a vacant serviced stand.

The subsidy will be used to decrease the mortgage bond and is only applicable to persons who have never been assisted by the state. It will be disbursed as a once-off subsidy towards the repayment of the bond. The subsidy attaches to the beneficiary and not to the property.

Read: The power of stokvels: Empowering communities through collective savings

The subsidy may be used to:

To buy a new or old residential property
To buy a vacant serviced residential-stand, linked to an NHBRC registered homebuilder contract; or
To build property on a self-owned serviced residential stand, through an NHBRC-registered homebuilder

FLISP assists qualifying beneficiaries who wish to obtain mortgage finance from a lender to:

Acquire ownership of an existing residential property.
Obtain vacant serviced residential stands which are linked to house-building contracts with home builders registered with the National Home Builders Registration Council (NHBRC) or
Build a new house with the assistance of a home builder registered with the National Home Builders Registration Council (NHBRC), on a serviced residential stand, that is already owned by the beneficiary.

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You Can Afford to Buy Your First Home, Thanks to The FLISP Subsidy

First-time homebuyers can qualify for a government housing subsidy of up to R121,626. Here’s all you need to know about FLISP.

Buying your first home can often feel like an unattainable dream, especially when your salary isn’t substantial. With the ever-increasing property prices, the possibility of owning your dream home often feels out of reach for many of us. However, there is some good news on the horizon – the FLISP housing subsidy. This initiative is bringing new hope and opportunities for aspiring homeowners like yourself.

The FLISP subsidy makes it possible for people like you to own the home you want.

What Can Use You a FLISP Subsidy For?

You can use your FLISP housing subsidy to put down a deposit on your first home or used to shorten your home loan repayment period or lower the monthly repayment amounts.

Applying for a bond to buy your first home can seem a terrifying prospect when you’re not a big money earner. The South African government, motivated by its desire to uplift and empower every citizen, created FLISP to enable lower and medium-income earners towards claiming their stake in the property market.

FLISP is like being given free money just so you can afford to buy your first home. You don’t need to pay back your FLISP subsidy at any time.

FLISP Application Criteria

If your family’s monthly income falls between R3,501 and R22,000 per month, you may apply for a FLISP subsidy. There are other qualifying criteria, so bear these in mind when you want to apply for a FLISP subsidy:

You must be a South African citizen, over the age of 18, and you must be married, cohabiting, or be a single person with a dependent. FLISP aims to enable families to own their own homes.
Your bank or financial institution must have already approved you for a home loan. You can’t apply for a FLISP subsidy from the government until you have been approved for a home loan. Of course, applying for a home loan means you’ll need to be credit checked, and agree to all the terms and conditions as set out by your financial institution.
Your household income will be analyzed in your application for a FLISP subsidy. Your total household income must not exceed R22,000 per month.
You cannot have previously benefited from a housing subsidy or government housing program. For example, if you live in an RDP house, you cannot receive a FLISP subsidy.
FLISP is a one-time payment subsidy. You cannot apply for a second FLISP subsidy when you want to purchase a second home.

Where to Apply for a FLISP Subsidy

As FLISP is a government-backed initiative, the Department of Human Settlement administers and processes applications for a FLISP subsidy. Once you’ve been pre-approved for a home loan, apply for a FLISP subsidy at your local Department of Human Settlement office, or call the National Housing Finance Corporation on 0860 011 011.

Bottom Line

FLISP plays a crucial role in making homeownership a reality for low- to middle-income South Africans. By offering financial assistance and access to housing finance, FLISP helps bridge the affordability gap and empowers individuals to achieve their dream of owning a home. If you meet the eligibility criteria, take the necessary steps to apply for FLISP and embark on your journey toward homeownership.