Buy Your Dream Home with the PMAY Scheme
Buying a home is everyone’s dream. But finding the right house takes time. And given the consistently high real estate prices, buying a home also causes financial stress. After all, property purchase is a serious financial commitment.
Thankfully, there is an easy way to lower your financial burden: You can simply opt for a home loan.
Things become easier still with help from the credit-linked subsidy scheme (CLSS) under the Pradhan Mantri Awas Yojana (PMAY).
The PMAY scheme was launched by the Government of India in 2015 to promote the vision of ‘Housing for All’ by the year 2022.
The CLSS under the PMAY scheme offers a subsidy on your home loan interest rate. Most banks and even non-banking financial companies (NBFCs) allow you to opt for this facility.
Features of the PMAY scheme
The CLSS is a key benefit under the PM Awas Yojana. It is aimed at helping the middle income groups (MIG), economically weaker sections (EWS), and lower income groups (LIG) in India.
The MIG is divided into two categories: MIG-I and MIG-II. The first group (MIG-I) covers households with an annual income ranging from Rs.6 lakh to Rs.12 lakh.
The second group (MIG-II) pertains to households with a yearly income between Rs.12 lakh and Rs.18 lakh.
People falling under EWS and LIG, who need a home loan, will get an interest subsidy of 6.5%. This will apply for a tenor of 20 years or for the tenor of the loan, whichever is lower.
Those belonging to the MIG-I and MIG-II categories will get an interest subsidy of 4% and 3%, respectively. The maximum tenure of the loan for both MIG categories is 20 years.
Keep in mind that the subsidy scheme will be available only for specified loan amounts. Those in the EWS and LIG categories can get the subsidy on a loan of up to Rs.6 lakh. Additional loans beyond this limit, if any, will be charged the non-subsidized interest rate.
For the MIG-I and MIG-II groups, the subsidy will apply to maximum loans of Rs.9 lakh and Rs.12 lakh respectively.
The interest subsidy will be credited to the loan account of the beneficiary through the lender. This will reduce the effective loan costs and the equated monthly installment (EMI).
Eligibility criteria
The tagline of the scheme is ‘Housing for All’. The implication is that the scheme is offered only to first-time homebuyers.
The scheme is offered to families, consisting of husband, wife, and unmarried children. In case of a married couple, either of the spouses can apply, or both can apply together for joint ownership.
They cannot separately apply with the aim of buying or building two separate houses.
There are certain Pradhan Mantri Awas Yojana eligibility criteria to consider here. For instance, the beneficiary should not already own a pucca house in India in their name.
Nor should an immediate family member of the beneficiary own such a house. Also, the beneficiary family should not already have received housing assistance under any Central Government or state government scheme.
Additionally, the Aadhaar numbers of the beneficiary family members will be required at the time of application.
Conclusion
The PMAY scheme is designed to boost the Indian housing segment. The CLSS is especially helpful in reducing the home loan burden of first-time homebuyers.
If you are eligible for the subsidy, take some time to find the best home loan. Use a home loan EMI calculator to compare the home loan interest rates offered by different lenders.
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Category: Housing
