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PMAY promises equal housing opportunities for all
Grants subsidies of up to 6.5% on home loan interest rates
Promotes mandatory homeownership for women
Facilitates use of eco-friendly construction materials
Housing is a basic necessity for everyone; however, with rising costs of land and homes in India, this necessity remains a dream for most. To tackle the issue of making housing more affordable for all sections of society, the government started Pradhan Mantri Awas Yojana (PMAY), a scheme that helps you become a homeowner on easy terms. PMAY aims to provide 20 million individuals with housing by 2020. The government aims to do this by offering interest subsidy for home purchase and by constructing affordable housing too. Additionally, the government recently announced that the GST rate applicable on home loans will be reduced from 12% to 8% for those who apply for the loan under the Pradhan Mantri Awas Yojana schemes. This will give a big boost to urban home investors like you.
The biggest benefit of PMAY scheme is the subsidy offered by the government on new house purchases. However, to avail your subsidy you or anyone in your home cannot already be a homeowner. The government offers a credit linked subsidy depending on your income, ranging from EWS/LIG to MIG 1 & MIG 2.
For those who fall under the EWS/LIG category, home loan interest rates are subsidised by 6.5% for a tenor of 20 years.
For those who fall under the mid-level MIG category, the home loan interest rate is subsidised by 4% on a maximum loan amount of Rs.9 lakh for a tenor of 20 years.
For those who fall under the MIG 2 category, the home loan interest rate is subsidised by 3% on a maximum principal amount of Rs.12 lakh for a tenor of 20 years.
Pradhan Mantri Awas Yojana or the PMAY scheme was initiated to provide the urban poor with affordable housing solutions. It was introduced by the Government of India on the 1st of June, 2015 to extend PMAY benefits under the ‘Housing for All’ mission. Under this scheme, first time home owners will enjoy subsidised interest rates on housing loans.
To be implemented during the 2015-2022 period, the scheme will include four components mentioned below. Individuals meeting PMAY eligibility can benefit from these.
Credit Linked Subsidy Scheme (CLSS.)
Partnered Affordable Housing.
Rehabilitation of slum dwellers, in-situ basis.
Subsidised individual house construction or enhancement.
The scheme is divided into PMAY (Urban) and PMAY (Gramin). Individuals who are eligible for PMAY benefits -
|All Beneficiaries under PMAY (U) scheme||Economically Weaker Section (EWS), Low Income Group (LIG) and Middle Income Group (MIG).|
|Beneficiaries under CLSS of PMAY (U)||Lower Income Groups and Middle-Income groups|
|Beneficiaries under PMAY (G) scheme||EWS, LIG and BPL (Below Poverty Line)|
Here are some other economic eligibility criteria an individual must fulfil to apply and secure a subsidy for house construction, improvement or enhancement.
|Particulars||MIG - 1||MIG - 2||LIG||EWS|
|Annual income (household)||Rs.6 lakh to Rs.12 lakh||Rs.12 lakh to Rs.18 lakh||Rs.3 lakh to Rs.6 lakh||Up to Rs.3 lakh|
|Subsidy on home loan interest rate||4% p.a.||3% p.a.||6.5% p.a.||6.5% p.a.|
|Eligible amount of home loan for subsidy qualification (Maximum)||Rs.9 lakh||Rs.12 lakh||Rs.6 lakh||Rs.6 lakh|
|Maximum tenor of home loan (In years)||20||20||20||20|
|Amount of subsidised interest (Maximum)||Rs.2.35 lakh||Rs.2.30 lakh||Rs.2.67 lakh||Rs.2.67 lakh|
|Dwelling unit’s carpet area (Maximum) (in sq. m.)||160||200||60||30|
|Home loan sanction date for scheme applicability (on or after)||01.01.2017||01.01.2017||17.06.2015||17.06.2015|
Once you have met these eligibilities, check out how to apply for PMAY and enjoy benefits under the scheme. Avail a home loan from Bajaj Finserv to finance the purchase of your first house and reduce your EMI burden with the help of PMAY.
Under the PMAY scheme, the government seeks to construct 2 crore affordable houses in prominent urban areas for those who are eligible to avail the scheme. The construction of these homes has already begun in states such as Maharashtra, West Bengal, Tamil Nadu, etc. Through these houses, the government will be able to uplift the standard of living for many.
The PMAY scheme is not restricted only to the urban areas; equal importance is also being given to the rural development of low- and middle-income groups. In rural areas, apart from raising the standard of living for low-income group individuals, the schemes undertaken by Pradhan Mantri Awas Yojana guarantee development in the rural real estate sector and associated industries.
PMAY makes female homeownership a mandatory clause and mentions the house should be registered in a women’s name even in cases when she is not buying the property. Additionally, preference provisions exist for salaried women, widows, transgender people, the disabled, minorities and seniors to avail the Pradhan Mantri Awas Yojana scheme and become homeowners. In case you buy a home under this scheme as a senior citizen, you can be assured of ground floor accommodation since the scheme has specially added this as a mandatory clause to allow senior citizens more comfort.
The developers have been instructed to build houses using eco-friendly construction technology and materials under this scheme. This will ensure limited damage on the environment in and around construction sites and will lower pollution scales by keeping it under check too.
With the knowledge of these PMAY benefits, you can now check the Pradhan Mantri Awas Yojana eligibility criteria to see whether you qualify as a contender. Once you know you are eligible, you can then apply for a Home Loan under PMAY with lenders like Bajaj Finserv. This will allow you to avail the benefits of PMAY scheme along with the flexible terms of repayment, thereby adding affordability to your home purchase.
Additional Read: Check your Name in Pradhan Mantri Awas Yojana Beneficiary List
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