Minha Casa Minha Vida
The Minha Casa, Minha Vida (My House, My Life) programme was announced by the Federal Government in March 2009 as one of the means of reducing the inequality gap and housing deficit in Brazil. The government's budget for the programme is over R$ 34 billion. The aim is to build over 1 million houses in partnership with the states, municipalities and the private sector and allocated to families based on household income and is defined as a multiple of minimum monthly wage (currently R$465) For household incomes up to 3x minimum wage will be permitted to access the full allowance and not pay any insurance and notary registration costs. For household incomes up to 6x minimum wage; Households will get income supplements for loans; a discount on the cost of insurance; a 90% reduction of the notary registration cost and access to the ‘guaranteed’ fund (which will cover them in the case of unemployment, death or other specified circumstances); For households up to 10x minimum wage can get lower costs of insurance, an 80% reduction of the notary registration cost and access to the ‘guaranteed’ fund. Under the program (administered and governed by the Caixa Econômica Federal), households earning up to 4,200 reais are able to purchase a house with a close to zero interest rate and refinance it over 36 months. As an example, up to 3 times the minimum wage will be allowed to purchase a house up to the value of R$ 52,000 reais, for which the scheme will contribute R$ 46,000 leaving the buyer to provide the remainder $BRL 6,000 – this would (usually) be borrowed from the Caixa Econômica Federal and repaid in instalments of $BRL 167.50 per month. (which compares favourable to rents they may pay) Those in the higher income brackets are able to access smaller subsidies and finance packages. The maximum loan-to-value ratio is 90 percent (80 percent for higher-income brackets) with interest rates ranging between 5 and 8 percent. A number of incentives have also been granted to the Brazilian construction industry including loans at 1% above the TJLP (the long-term interest rate); reduced or completely eliminated tax structures; and extended repayment / grace periods. The Process Caixa approves each housing development in conjunction with state or municipal governments. Homebuyers make their first payments after they move in (whereas previously they would pay in instalments during pre-construction which made buying a home unaffordable for low income people). The programme is intended to reduce social inequality, improve the quality of life of people and increase
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