Reserve Bank of India (RBI) has increased the limit of home loan in priority sector to Rs 35 lakh. For house worth up to Rs 45 lakh, loans up to Rs 35 lakh will be considered in the priority sector. The priority sector loans are slightly cheaper than the prevailing rates in the market. It is also easy to get these loans from banks.

During the monetary policy review last week, the Reserve Bank of India had announced to increase the maximum limit of home loan under priority sector. According to its notification, the limit of home loan has been increased to give cheap loans to the weaker sections and low income people. Let us understand it by table below:

S. N.AreaAmended LimitsPrevious Limits
Value of HouseLoan  AmountValue of House
Loan  Amount
1.Metropolitan Cities
45 lakhs35 lakhs35 lakhs28 lakhs
2.Other Cities and Towns
30 lakhs25 lakhs25 lakhs20 lakhs

Note: These loans will come in priority sector only when the total value of the house is also less than the fixed limit.

According to the RBI notification, the amendment has also been made in the annual income of the Economically Weaker Sections (EWS) and Lower Income Groups (LIG) category for the loan in the housing project. Now the maximum income of these two classes will be ₹ 3 lakh and ₹ 6 lakh respectively. The changes has been made in the maximum income of these categories in accordance with the terms of the Prime Minister's housing scheme.

click here to read notification.