The Lucknow Development Authority (LDA) brings relief to economically weaker sections by waiving compound interest for defaulters of EWS and LIG houses and shops up to 20 square meters. The decision, approved during the LDA board meeting, aims to ease the financial burden on allottees under EWS, LIG, and Pradhan Mantri Awas Yojana. Divisional Commissioner and LDA chairperson Roshan Jacob, highlighting the hindrance posed by compound interest on recovery of dues, said that this move would rectify the issue to a large extent. LDA has taken a slew of measures to boost demand over the last couple of years such as lowering of interest rates, extending EMI period, and even freezing the flat prices under the first-come-first-served scheme for a year.
In a significant move benefiting economically weaker sections (EWS), the Lucknow Development Authority (LDA) has declared that allottees of EWS and LIG (Low-Income Group) houses and shops measuring up to 20 square meters would be exempt from compound interest charged on the default amount. This decision, announced during the 179th board meeting, reflects the LDA's commitment to providing financial respite to those falling under the EWS and LIG categories, including beneficiaries of the Pradhan Mantri Awas Yojana.
Divisional Commissioner Roshan Jacob, who also holds the additional charge as the LDA chairperson, played a crucial role in approving this proposal. He emphasized that the compound interest, especially when coupled with penalties, hindered the recovery of dues from allottees, particularly those from economically weaker sections. Jacob elaborates saying that many EWS and LIG allottees find it challenging to repay amounts calculated with penal interest. In response to these challenges, the board approved the proposal, ensuring that defaulting allottees will now be exempted from penal interest. Instead, only simple interest will be charged at a rate determined at the time of allotment.
This decision follows a series of measures taken by the LDA to enhance affordability and accessibility for homebuyers in these segments. Last year, the LDA implemented a reduction in interest rates and extended the EMI (Equated Monthly Instalment) period from two to five years, demonstrating a commitment to supporting homebuyers in the EWS and LIG categories.
Simultaneously, the LDA has taken up additional measures to simultaneously stimulate demand in the real estate market. The freezing of prices for flats under the first-come-first-served scheme is a strategic move aimed at attracting potential buyers who may have been deterred by the rising prices in the real estate sector over the past year.
Indramani Tripathi, Vice-Chairperson of LDA, shared insights into this initiative, stating that the prices of all 2,630 flats have been frozen for a year, retaining them at the old rates. This proactive step is anticipated to encourage buyers to consider acquiring vacant flats, contributing to increased demand in the real estate market.
The overall approach of the LDA, as evidenced by these decisions, reflects a dual commitment of alleviating financial burdens for economically weaker sections and strategically stimulating the real estate market. These efforts align with the broader objectives of promoting affordable housing, supporting homebuyers, and fostering a dynamic real estate environment in the Lucknow region.
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