Guidelines to Get Subsidy for Housing Loan Under PMAY

The Pradhan Mantri Awas Yojana (PM  AWas Yojana) introduced by the Government of India targets to provide housing for all by March, 2022. CLSS or Credit Linked Subsidy Scheme for LIG/EWS or MIG (I&II) is a significant vertical of PMAY Scheme. The other three components are In Situ Slum Redevelopment, Beneficiary Led Construction and Affordable Housing in Partnership. 

If you are looking to own a home of your own, under the Pradhan Mantri Awas Yojana (Urban), PMAY (U) scheme, here are few important things to consider about the PMAY scheme, even while you arrange the amount for down payment, decide the location, builder and the home loan lender.

PMAY (U): Features and benefits

PM Awas Yojana has brought a series of benefits for first-time homebuyers. A subsidy on your home loan interest is one of the prime advantages that PMAY provides. Claiming the PMA subsidy on your home loan is easy if you apply for the PM Awas  Yojana according to your income and buy a home that fulfils the criteria. 

PMAY Eligibility

To access PM Awas Yojana benefits and subsidies, you must either apply as an unmarried individual or as a representative of a family that includes your parents, spouse, and unmarried children. Apart from these basic eligibility pointers, income criteria and other PMAY eligibility norms are also to be followed:

•    You or your family cannot be the owner of a pucca house. Being an existing homeowner declares you unfit for a home loan under PMAY. 

•    You or your family should not have availed facilities and benefits of another government housing scheme in the past.

•    You need to have an Aadhaar Card before applying for this.

•    To be eligible for PMAY under EWS category, your annual household income should be below Rs. 3 lakhs

•    To be eligible for PMAY under the LIG category, your combined annual household income should be between Rs.3 lakh to Rs.6 lakh. 

•    To qualify as a MIG-I applicant, your yearly household income should be between Rs.6 lakh and Rs.12 lakh. 

•    To qualify as a MIG-II applicant, your yearly household income must not exceed Rs.18 lakh. 

How to Apply For This Home Loan Subsidy?

Eligible applicants can directly apply for a home loan under CLSS with Prime Lending Institutions e.g. NBFCs, cooperative banks, regional rural banks, and others who have partnered with the central nodal agencies to offer subsidised rates on housing loans. 

Subsidised loans from where

One can avail PMAY linked loans from any primary lending institutions such as commercial banks, housing finance companies, Regional Rural Banks s), State Cooperative Banks, Urban Cooperative Banks, Small Finance Banks, Non-Banking Financial Company etc. There will not be any processing charge for eligible housing loan amount as per income criteria under the Scheme. 

How to Claim the Subsidy?

Once you enrol for the Pradhan Mantri Awas Yojana, you can apply for a home loan with a lender of your choice. Here, be sure to select the one enlisted under PMAY. The next step will be to compare various lenders and loan offerings according to the home loan interest rates. As soon as your application gets approved, you will receive your loan amount in your account. The lender will then claim PMAY subsidy on your behalf from the government. 

When the lender receives the subsidy, they will credit it into your home loan account and your EMIs will decrease accordingly from thereon. This means that initially while repaying your home loan you will have to put forward EMIs concerning the standard interest rate. It is only after a few months, when the government approves your lender’s application on your behalf that your EMIs will decrease and you will get compensated for the excess you have already repaid towards your interest obligation.