Union government is likely to announce a special package for the housing sector on Monday. The special package may include cheaper home loans, full waiver of processing charges and concessions on margin money. There may be reduction in the interest rates and exemption from home processing fees up to Rs 5 lakh. RBI may also announce relaxation in the risk-weight and margin requirement for home loans. Currently, risk weight age for home loans up to Rs 20 lakh is 50 per cent, which is likely to be hiked.

The officials of union finance ministry held a meeting with the executives of banks in Delhi last week. It was decided in the meeting to disburse the home loans at low interest rate to push the demand in the home sector. An official said, "Bankers at a meeting convened by the Indian Banks' Association in Delhi a couple of days ago, had reached a consensus on disbursing home loans to the bottom of the pyramid. The government is assessing the suggestions received from bankers and is likely to announce the details tomorrow."

It is recalled that the union government had announced a special economic booster package last Sunday to propel the economy. It has promised to release a special package for the housing segment and small and medium enterprises within a couple of days.