How can you get home loan subsidy under Pradhan Mantri Awas Yojana?

March 21, 2020 Uncategorized


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Under Pradhan Mantri Awas Yojana (Urban), the credit linked subsidy scheme (interest subsidy) to the weaker income group (EWS or EWS) and lower income group (LIG or LIG) can be availed till next year.

Actually, the government has extended PMAY till 31 March 2020. Under PMAY, interest subsidy can be availed on home loan to build or buy the first house.

People from weaker income groups can avail Rs 2.60 lakh on the interest of home loan. Earlier this scheme was ending in December 2017.

Pradhan Mantri Awas Yojana How can you get home loan subsidy under Pradhan Mantri Awas Yojana?

Those whose income is less than three lakh rupees per annum fall in the EWS category. People earning up to six lakh rupees annually come to LIG. In both these categories, up to 6.5 percent interest subsidy can be availed on loans up to six lakh rupees under PMAY.

The CLSS was launched by the Modi government’s ambitious plan, Home for All-2222. Later it was also increased to people with income ranging from six lakh to 12 lakh rupees annually and 12 to 18 lakh rupees annually.

Wishfin CEO Rishi Mehra said, “People with income up to Rs 12 lakh were placed in the MIG-1 category, while those with higher income were placed in the MIG-II category. Those in the first category up to Rs 9 lakh. Four percent interest in home loans and those in other categories can avail three percent interest subsidy on home loans up to Rs 12 lakh. “

He said, “On taking a home loan beyond this limit, the interest on the remaining amount will be paid at the normal rate. The maximum time limit in case of each type of loan can be 20 years.”

Now, in the case of every beneficiary segment, the total amount of subsidy is reduced from the initial principal.

Mehra said, “Do not think that the interest subsidy amount will come from the difference between normal and subsidized interest rate. This interest, in turn, is calculated from the net present value (NPV) of the subsidy amount. Net present value is calculated at a discount rate of 9%. “

He said, “After reducing the amount of subsidy provided by the government in the PMAY from the total amount of loan, interest is charged on the remaining amount at the normal rate.”

The monthly installment of a person taking loan under PMAY scheme can be reduced from 2012 to Rs 2,318 and the total interest liability can be reduced from Rs 4,85,866 to Rs 5,56,102.

This is how the PMAY plan

In Credit Linked Subsidy Scheme (CLSS), middle-income people whose annual income is between 6 lakh to 12 lakh rupees, they will get 4 percent interest subsidy on 20-year home loan of 9 lakh rupees. .

For example, the rate of interest on a home loan is 9 percent, then you will have to pay only 5 percent under PMAY. Those with an annual income of Rs 12 lakh to Rs 18 lakh will get an interest subsidy of 4 per cent.

PMAY extended time

Housing and Urban Development Secretary Durga Shankar Mishra said that the Credit Linked Subsidy Scheme has been extended till 31 March 2020. To achieve the target of Housing for All by the year 2022, the government has extended the period for availing PMAY.

Where can you benefit from

Banks, housing finance companies, regional rural banks, small finance banks and many institutions are providing the benefit of this scheme to the customers. National Housing Bank (NHB) and HUDCO (HUDCO) are also included in this scheme.