In June 2015 the Ministry of Housing and Urban Poverty announced Pradhan Mantri Awas Yojana (PMAY). It is a Credit Linked Subsidy Scheme (CLSS) to meet the goal of housing for all. The scheme design provides loans at highly subsidized interests to meet the construction, purchase, extension or development of the houses in three categories of segments basically – economically weaker section (EWS), lower-income group (LIG), and middle-income group (MIG).
The primary purpose of the PMAY scheme is to make the housing loan available and affordable to all. The subsidy amount gets determined on the income criteria that the applicant belongs to and the size of the property that needs financing.
The benefits given to the different income categories are as follows:
LIG/EWS category – Low-income group (LIG) and economically weak section (EWS) segments can be recognized as those households whose yearly income falls between INR 3 lakh and INR 12 lakh. The recipients in this category are eligible to receive a maximum interest subsidy of 6.5 percent. To seek this facility, it is compulsory that the building constructed or acquired must not go beyond the limit of the carpet area of 60 sq.mts. The interest subsidy will be given on maximum loan amount of INR 6 lakhs.
In the year 2017, PMAY was extended to middle-income groups (MIG-1 and MIG-2) as given below.
MIG-1 category – MIG 1 category comprises of those households whose income is more than INR 6 lakh per annum but does not exceed INR 12 lakh. The recipients who come under the MIG-1 category are eligible to get a maximum interest subsidy of 4 percent under the stipulation that the property or house constructed, acquired or extended does not go beyond the carpet area of 160 sq.mts. The recipient can avail maximum loan amount under this subsidized interest scheme is INR 9 lakh with the loan term of up to 20 years.
MIG-2 category – MIG 2 category comprises of those households that have a yearly income of INR 12 lakh but is less than INR 18 lakh. The recipients under this category are eligible for a maximum subsidy of 3 percent. The scheme makes it is compulsory that houses constructed, expanded or purchased under this scheme must not go beyond the carpet area of 200 sq.mts. The upper constraint placed on the amount of the loan under this kind of subsidized interest is INR 12 lakh. The tenure period is up to 20 years.
Eligibility for Pradhan Mantri Awas Yojana
For availing the scheme, the recipient and the recipient’s family members mustn’t own a pucca house in the name of any family members anywhere in the country.
When a married couple seeks for the loan under PMAY scheme, either one of the spouses or both jointly (joint ownership) are eligible for a single subsidy.
The recipient family must not have taken or received any assistance from the central government under any other housing schemes or benefits offered by the government.
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