Finance

Everything You Want to Know about PMAY

Launched in 2015, the Pradhan Mantri Awas Yojana or PMAY is an affordable housing scheme, which aims to fuel the ‘housing for all’ project started by the central government of India. Under the scheme, the government aims to provide a pucca house to all Indian citizens. In order to accomplish the mission, the government is building more than 2 crores new affordable homes across cities in India.

Apart from building new homes, the government of India also aims to make housing affordable for all citizens. Under the scheme, the government provides a subsidy on the home loan interest rate and encourages the people to become homeowners, especially the people belonging to the Economically Weaker Section (EWS), Low-income Group (LIG) and Middle-income Group (MIG).

The broader mission of the PMAY initiative has more important components:

  • Collaborate with private builders to redevelop the slums using land as a resource.
  • Make housing affordable for the poor section of the society through the Credit Linked Subsidy Scheme or CLSS.
  • Build new affordable housing units through public and private sector partnership.
  • Construction and enhancement of houses. They are allocated through identified eligible beneficiaries.

Features of PMAY

  • As per thePMAYrules, the home loan applicants are provided an interest subsidy up to 6.5% for a loan duration of 20 years.
  • All the new homes built under the PMAY schemes will have basic amenities such as access to clean drinking water, sanitation facilities, and 24×7 supply of electricity.
  • For the allocation of houses on the ground floor, preference will be given to senior citizens and differently-abled applicants.
  • To ensure sustainable development, the government has directed all the builders to use eco-friendly building material for the construction of new homes under the PMAY scheme.
  • In order to encourage women to be homeowners, the scheme makes it necessary for all applicants to have a woman as a co-applicant and register the property in the name of the female member of the family.

Eligibility criteria for PMAY

The eligibility criteria for PMAY varies based on the income category – EWS/LIG, MIG-I and MIG-II.

To qualify for the PMAY benefits under EWS/LIG scheme, you must:

  • Have an income up to Rs. 3 lakhs per annum and not exceed Rs. 6 lakhs.
  • Buy a property that has a carpet area not exceeding 30 sq. meter (for EWS category) and 60 sq. meter (for LIG category). The carpet area is the actual floor space within the house, excluding the external walls.
  • Be aged not more than 70 years, and the loan tenure should not be more than 20 years.

To qualify for the PMAY benefits under MIG – I scheme, you must:

  • Have an income up to Rs. 6 lakhs per annum but not exceed Rs. 12 lakhs.
  • Purchase a property that has a total carpet area of 90 sq. meter.
  • Avail a loan for a maximum duration of 20 years.
  • Limit your borrowings up to Rs. 9 lakh to get an interest subsidy of 4%. The additional amount will not be linked to CLSS if you borrow more than Rs. 9 lakhs.

To qualify for the PMAY benefits under MIG – II scheme, you must:

  • Have an income above Rs. 12 lakhs per annum but less than Rs. 18 lakhs.
  • Apply for a loan with a term less than 20 years. But in some cases, if your age remains less than 70 at the end of the loan tenure, you can avail a maximum loan up to Rs. 30 lakhs.

General Rules to be Eligible for PMAY benefits

  • You or any of your family member should not own a pucca house in any part of India.
  • You or any of your family members should not have sought financial help through any other affordable housing schemes of the government.
  • You must either apply for a joint home loan with your spouse or you can apply for it individually if you are a married person.
  • You can avail the loan to carry out repair works in your home.
  • You must have an adult female member in the family to be one of the co-owners of the property you purchase.

Knowing the features and eligibility criteria of PMAY can help you apply for the loan under the appropriate income category and make the most out of the benefits.

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