A home is a quintessential financial security an individual can have. From securing the financial future of your children to being used as a security against loans, home can also provide you with an economic retreat. With rising real estate costs, owning a home is still a dream for many. Home loans can make it a resort during such a crisis, but some sections of the society always find it hard to opt for the loan. Pradhan Mantri Awas Yojana (PMAY) is a government housing scheme which can help those economically weaker people to get interest subsidies on their home loans. Even the lower and middle-income groups can avail the subsidy on the home loans, provided the eligibility matches the criteria.
Eligibility criteria to avail subsidy
The Pradhan Mantri Awas Yojana (PMAY) is a government housing scheme focusing at providing permanent housing for the urban and rural population of the country. Any family that does not own any concrete house is eligible for a subsidy through PMAY, as per the income criteria defined for the family. The annual income of households plays a noteworthy role in determining the eligibility for availing this feature. To avail the scheme, the maximum household income per annum should be: Up to 6 lakhs for economically weaker section, 6 – 12 Lakhs for middle-income group 1 and 12-18 lakhs for middle-income group 2. Apart from that, the beneficiary family shouldn’t have benefited under any of the government housing schemes to avail the scheme.
Availing PMAY subsidy on the home loan
Most of the banks provide the Credit-Linked Subsidy Scheme (CLSS) under PMAY, which offers interest subsidy on housing loans to beneficiaries from the Economically Weaker Sections, Low-Income Group and middle-income group. The interest rate subsidy provided is 4% for middle-income group 1 category, and the maximum loan amount one can avail is nine lakhs. Similarly, for middle-income group 2, the subsidy provided is 3%, and the maximum loan amount ranges up to 12 lakhs. The subsidy rate will be only applicable to the maximum amount the specific group can avail. For the remaining home loan amount, the bank interest rate will be charged. Most of the banks provide a subsidy calculator to check the home loan subsidy under the PMAY scheme. Once your home loan is disbursed, banks will send the needed details to the National Housing Bank (NHB) for verification. If you are eligible for the scheme, NHB will approve the subsidy which you’ll get on your home loan. The lenders will credit the subsidy amount received from the NHB to the borrower’s housing loan account, and this will be adjusted with the total home loan account.