All About PMAY You Need To Know

By Jay Dee Infra In PMAY, Pradhan Mantri Awaas Yojna No comments

All About PMAY You Need To Know

Our Prime Minister, Shri Narendra Modi had announced a special home loan subsidy scheme “Pradhan Mantri Awas Yojana” in June 2015 to promote “Housing for All”. The purpose of the scheme is to provide affordable housing to urban and rural poor with a target of building 20 million houses by March 31, 2022. This scheme promises to provide homes to Low Income Group and Economically Weaker Sections of our country through a financial assistance of Rs. 2 trillion from the Central Government. Under this scheme, Government will provide interest subsidy of up to 6.5% on housing loans availed by the beneficiaries for a tenure of 20 years. Also, there is no cap on maximum loan amount and the additional rate beyond specified limits will be calculated under non-subsidized rate.

PM Home Loan Subsidy Benefits

  • Special home loan subsidy scheme by Prime Minister Shri Narendra Modi to promote “housing for all”.
  • The interest subsidy will be credited upfront to the loan account of beneficiaries, thus reducing the burden of EMIs.
  • The interest subsidy on home loan will be available for a maximum loan tenure of 20 yrs or loan tenure availed by borrower whichever is lower.
  • The Net Present Value (NPV) of the interest subsidy will be calculated at a discount rate of 9%.
  • There is no cap on the maximum loan amount on the cost of the property.
  • The additional loan beyond the specified limits, if any, will be calculated at non-subsidized rate.
  • National Housing Bank (NHB) and Housing and Urban Development Corporation (HUDCO) will reimburse interest subsidy to the lenders. No extra processing fee will be charged from the borrowers.

Maximum interest subsidy under CLSS Scheme 2018

Income wise and size of the house wise eligibility for interest rate CLSS subsidy has been mentioned in the table below:

CLSS scheme type EWS amd LIG MIG 1 MIG 2
Maximum annual income of applicant Upto Rs. 6,00,000 Upto Rs. 12,00,000 Upto Rs. 18,00,000
Max carpet area (sq m) of house 60 sqm 160 sqm 200 sqm
Interest subsidy (%) 6.50% 4.00% 3.00%
Subsidy calculated on Maximum Loan amount of Rs. 6,00,000 Rs. 9,00,000 Rs. 12,00,000
Maximum Interest subsidy (Rs) 2.67 Lacs 2.35 Lacs 2.30 Lacs
Validity of scheme 31/03/2022 31/12/2017 31/12/2017

**for MIG – 1 & 2 loan should be approved on/or after 1-1-2017

CLSS scheme is categorized into 3 categories –

Scheme for EWS and LIG Group – Individuals with income of up to Rs. 6 Lakh fall under EWS (Economically Weaker Sections) and LIG (Low Income Group). Under this category, you can get interest subsidy of 6.5% for a loan amount of up to Rs. 6 lakh and carpet area of 60 sqm.

Scheme for MIG-1 Group –Individuals with income of up to Rs. 12 Lakh fall under MIG (Middle Income Group) group. Under this category, you can get an interest subsidy of 4% for a loan amount of up to Rs. 9 lakh and carpet area of 160 sqm.

Scheme for MIG-2 Group –Individuals with an income of Rs. 18 Lakh fall under EWS (Economically Weaker Sections) and LIG (Low Income Group) group. Under this category, you can get an interest subsidy for a loan amount of up to Rs. 18 lakh and carpet area of the house should be up to 200 sqm.

*Interest rate on loan amount beyond the specified limits will be calculated based on the regular home loan rates.

pmay process

Carpet area raised by 33% under CLSS for Middle Income Group borrowers

In June 2018, government has increased the carpet area of houses that can be eligible for the Credit Linked Subsidy Scheme under the Pradhan Mantri Awas Yojana (PMAY) for the middle income group beneficiaries. In the MIG-1 category of CLSS, the eligible carpet area has been increased from 120 square metre to up to 160 square metre. In case of MIG-2 category, the carpet area has been increased to 200 square metre from the the previous eligible area defined at 150 square metre. With this change in carpet area, MIG category borrowers can avail interest subsidy for bigger sized houses.

Pradhan Mantri Awas Yojana Eligibility

PMAY Scheme can be availed by families which meet the following eligibility criteria –

  • Family does not own a pucca house in the name of any member of his/her family in any part of India.
  • Family has previously not availed any benefit under PMAY scheme or any central assistance under any housing scheme from Government of India.
  • Loan is available to all Indian citizes, including women citizens
  • In case of married couple, either of the spouse or both together in joint ownership can get a single subsidy.

In addition to the above critieria, the applicant should meet the criteria specified for loan amount, annual income and carpet area of the house to be eligible under the CLSS scheme for various categories of borrowers. Also, note that Aadhaar number of the beneficiary family are mandatory for MIG category.

How much interest subsidy can I get under PM subsidy scheme?

The government provides an interest subsidy of 3-6.5% depending upon the loan amount, annual income and category of borrower.

  • If annual income of a person is below Rs. 6 lakh and loan amount applied is up to Rs. 6 lakh, the person will be eligible for an interest subsidy of 6.50%
  • If annual income of a person is up to Rs. 12 lakh and loan amount applied is up to Rs. 9 lakh, the person will be eligible for an interest subsidy of 4%
  • If annual income of a person is up to Rs. 18 lakh and loan amount applied is up to Rs. 12 lakh, the person will be eligible for an interest subsidy of 3%

What is the maximum loan amount I can get?

Under PM home loan subsidy scheme, there is no cap on the maximum loan amount you can apply for. If the loan amount you apply for is beyond the specified limits, then the interest rate for additional loan amount will be calculated at regular home loan rates. Suppose, you fall under LIG category and you are eligible to get subsidy of 6.5% on home loan. You apply for a loan amount of Rs. 10 lakh which is beyond the specified limit of Rs. 6 Lakh then the interest rate for additional amount of Rs. 4 lakh will be calculated at normal housing loan rates.

Pradhan Mantri Awas Yojana Rural

PMAY rural scheme will be implemented in all areas of India except Delhi and Chandigarh. PMAY housing loan subsidy rural has following key points:

  • To construct 1 crore pucca houses for the rural poor in the next three years and total 4 crore houses by 2022
  • The project will be implemented in a span of three years from 2016-17 to 2018-19 with a budget of Rs. 81,975 crore
  • The cost of unit (house) assistance will be shared between central and state government
  • Beneficiaries of the rural houses would be chosen according to data taken from the Socio-Economic Caste Census of 2011
  • An allowance of Rs. 120,000 and Rs. 130,000 will be provided in plain areas and hilly areas respectively
  • The housing unit size can be upto 25 sq mtr including a dedicated cooking area
  • Provision of toilets at Rs. 12,000 and 90/95 days of unskilled wage labour under MGNREGA
  • The beneficiary would be facilitated to avail loan amount of up to Rs. 70,000 for construction of the house which is optional