Rural Housing Loan Fund

The rural housing loan fund is an agency of the National Department of Human Settlements.

The RHLF was established in 1996 by the National Department of housing. It was established to enable low-income earners to access small loans that they could afford to repay. The loans are strictly for improving house conditions.

Where you can find RHLF

The Rural housing loan fund is for all South Africans who stay in rural areas. RHLF works with different intermediaries who may be retail, community-based, or NGO housing finance lenders to facilitate the housing of microloans throughout the rural areas of South Africa including small towns and secondary cities.

The RHLF mission

At RHLF they strive to empower rural people to maximise their housing choices as well as improve their living conditions with access to credit from sustainable retail lenders.

They respect values

All they do is help people achieve their dreams of owning homes regardless of how little they earn. They, as RHLF it is wise to have values that keep them accountable for their job. The RHLF values are:

• They are dedicated to improving the living conditions of rural people.
• They strongly believe in sustainable, responsible social and economic development.
• When working as a team, loyalty is key. And practice joint accountability.
• They practice teamwork as often as possible and straight talk.

Through their intermediary lenders, they can reach all nine provinces of South Africa efficiently.

The RHLF is mostly for rural people who earn a low income. At RHLF they consider a low income as an amount of R15 000 per month.

Rural housing structured loans

Structured loans are the primary products offered at RHLF. They are given to intermediaries to support or develop a home loan operation addressing the need of individual households. Usually, the minimum loan size is R1 million unless the Credit Committee decides otherwise.

The structured loans

All Structured loans are tailored to match the intermediary’s underlying product profile and are given out according to the following criteria:

• Structured Drawdowns to limit RHLF exposure.
• All qualifying loans should be matched with Drawdowns and should not allow the intermediary to build up extensive surplus funding.
• The drawdown schedule and the size of the facility should align with the growth pattern of the intermediary and its capacity to manage growth, so as to avoid potential destabilising effects. While ensuring that all repayment period matches that of the end user.

The Rural Housing Pilot loans

A Pilot loan is designed by RHLF as a venture capital investment instrument to support retail lenders to explore new markets. Usually, out of a pilot loan, a structured loan follows. The RHLF provides up to R5 million to enable an institution to test new ideas.