Extra funding for social loans

Summary

The government of Flanders will increase the amount of funding available for social loans for housing by €100 million next year, after demand saw the budget for this year run out of money early. The loans are offered at low interest and are available in amounts up to 100% of the value of the property.

Nearly 80% of residents are eligible for the low-interest loans

The government of Flanders will increase the amount of funding available for social loans for housing by €100 million next year, after demand saw the budget for this year run out of money early.

Social loans for home purchases are available from the Flemish Housing Fund (VWF) and the Flemish Agency for Social Housing (VMSW) for anyone unable to obtain credit from normal banks. The loans are offered at low interest and are available in amounts up to 100% of the value of the property. About 80% of people in Flanders are eligible, with only the top 20% of incomes excluded.

“Now that the banks are becoming even more reluctant to approve mortgages, the demand for social loans is growing,” said Flemish housing minister Freya Van den Bossche (pictured) last week. “That proves they are responding to a very real need. Every year they help thousands of Flemish families to realise their dream of owning their own home – even if the bank does not approve.”

Social home loans have indeed seen constant and massive growth: from 3,038 loans for a total of €351.6 million in 2006 to an estimated 4,741 this year, for a value of €700 million – an increase of nearly 100%. Next year’s fund of €814,429 is expected to finance about 5,500 loans.

Also last week, Van den Bossche responded to calls from think-tank Argus for insulation subsidies to be scrapped because, Argus claims, they help to widen the gap between rich and poor. “Nothing could be further from my mind than scrapping the premiums,” she said. “On the contrary, there will soon be a new, increased roof insulation subsidy for owners who rent their property at a reasonable rate.” In the last five years, more than 272,000 households have received an insulation subsidy, which also considerably reduces energy bills. 

Photo: Belga

Extra funding for social loans

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