PMAY explained

Posted on by

​PRADHAN MANTRI AWAS YOJANA (PMAY) – CLSS
Pradhan Mantri Awas Yojana, a government initiative, following the goal of “Housing for all by 2022”
while aiming to make the dream of owning a house for thousand a reality.Under the initiative, the
Credit Linked Subsidy Scheme (CLSS) offers affordable home loans for Economically Weaker
Section (EWS), Low Income Group (LIG) and Middle Income Group (MIG) 1 & 2 customers.
The product aims to target EWS, LIG and MIG 1 and MIG 2 customers in the urban market. First
time home buyers i.e. a household who does not own, at present, any pucca residential house in
India and wishes to buy a dream home for his/ her stay may avail the benefit under this scheme.
Features and Benefits of Pradhan Mantri Awas Yojana
1. Loan Amount: For EWS and LIG, avail a Home Loan of up to ` 25 lacs including insurance, and for
MIG avail a home loan up to ` 140 lacs including insurance (minimum loan amount ` 50,000
excluding insurance).
2. Tenure & Term: The tenure of your Home Loan ranges from 1 to 30 years. The term, however,
does not extend beyond the retirement age or 60 years, whichever is earlier (70 years for self-
employed individuals).
3. Purpose: Credit Linked Subsidy will be available for housing loans availed for new/ resale purchase
of home, construction loan for all segment and additionally for EWS/ LIG, extension/improvement of
rooms, kitchen, toilet, etc., to existing dwelling can be done.
4. Interest Subsidy: For EWS and LIG, the credit linked subsidy will be available only for loan
amounts up to ` 6 lacs and such loans would be eligible for an interest subsidy at the rate of 6.50%
p.a. (Approx. ` 2.67 lacs), for tenure of 20 years or during the tenure of loan whichever is lower, to
the eligible customers under the scheme.* For MIG 1 customers, subsidy will be applicable for loan
amounts up to ` 9 lacs and such loans would be eligible for an interest subsidy at the rate of 4% p.a.
for tenure of 20 years. For MIG 2 customers, subsidy will be available for loan amounts up to ` 12
lacs and such loans would be eligible for an interest subsidy at the rate of 3% p.a. for tenure of 20
years.
5. Processing Fees: Nil**
Processing Fees on loan amount as per maximum subsidy applicable (as per customer applicability)
to be refunded once claim is received from NHB.
6. Easy Repayments: You have 2 options for repayment of the loan based on the EMIs payable on
your Home Loan
a. Through ECS (Electronic Clearing Service) based on standing instructions to your bank.
b. Post Dated Cheques (PDCs) drawn on your Savings/Salary account.
7. Home Loan Tax Benefits: Resident Indians are eligible for certain tax benefits on principal and
interest components of a home loan. As per Income Tax Act 1961 rules, the current applicable

exemption under section 24(b) is ` 2,00,000/- for the interest amount paid in the financial year and
up to ` 1,50,000/- (under section 80 C) for the principal amount repaid in the same year.
8. Applicant and Co-Applicant: Home Loans can be applied by an individual. The loan amount can
be further enhanced by including an earning co-applicant. Female property ownership is mandatory
for EWS/ LIG category and not mandatory for MIG category.

Eligibility for Pradhan Mantri Awas Yojana
1. First-time home buyers who will be the end users
2. Female property ownership is mandatory only for EWS/ LIG and not mandatory for MIG 1 & MIG 2
category (for EWS/LIG customers, only in cases when there is no adult Female member in the
family. The property can be in the name of a male member of the household, or in the case of a
construction loan if the land is purchased before the scheme start date, the property may be in the
name of a male member of the household).
3. Loan applicant should not have availed any central or state government subsidy or benefit for
housing under PMAY.
4. Individual loan applicant should not own property under his or her name at present & along with any
of the family members including dependents.
5. Not applicable on renovation or improvement loans for MIG.
6. Property should be in urban areas basis 2011 census.
7. Customer Category

Economically Weaker
section
(EWS)

Low Income
Group
(LIG)

Middle Income
Group 1
(MIG 1)

Middle Income
Group 2
(MIG 2)

Household Income in `

Annual Family income
up to
` 3.00 lacs

Annual Family
income from
` 3.01 to
` 6.00 lacs

Annual Family
income from
` 6.01 to
` 12.00 lacs

Annual Family
income from
` 12.01 to
` 18.00 lacs
Subsidy 6.50% 4.00% 3.00%
Scheme Validity 31/03/2022 31/12/2017
Maximum Loan Amount (on which
subsidy is available) ` 6 lacs ` 9 lacs ` 12 lacs
Maximum Tenure 30 years 30 years
Carpet Area-Max (sqm) 60 sqm 120 sqm 150 sqm

Loan Purpose Purchase/Self Construction/Extension Purchase/Self
Construction

Purchase/Self
Construction
Max Subsidy (Rs.) ` 2.67 lacs ` 2.35 lacs ` 2.30 lacs
Woman Ownership Yes* Not Mandatory

Subsidy Advantage of Pradhan Mantri Awas Yojana
Example Example 1 Example 2 Example 3
Value of your Property (Find out the value
of your home in today’s market) ` 6,70,000 ` 10,00,000 ` 13,50,000
Loan to Value (A comparison between
value of your loan and value of your home) 90% 90% 90%
Loan Amount
(The total amount of loans available) ` 6,03,000 ` 9,00,000 ` 12,15,000
Loan Duration
(The time duration to pay back loan) 20 years 20 years 20 years
CLSS Subsidy @ 6.50% for 20 Years
(Pradhan Mantri Awas Yojana) – ESW & LIG ` 2,40,551 ` 2,67,280 ` 2,67,280
CLSS Subsidy @ 4% for 20 Years
(Pradhan Mantri Awas Yojana) – MIG 1 ` 1,41,040 ` 2,35,068 ` 2,35,068
CLSS Subsidy @ 3% for 20 Years
` 2,30,156 (Pradhan Mantri Awas Yojana) – MIG 2 ` 1,03,570 ` 1,72,617 ` 2,30,156

Documentation Required For Pradhan Mantri Awas Yojana
No. Document Name
1. KYC Documents & Photograph for all applicant.
Aadhar is mandatory for all applicants.
2. For Salaried: Salary slip or Certificate & updated bank statement
For Self Employed: Income Tax Returns with other financial of last two years and bank statement.
3. For identification as an EWS or LIG beneficiary under the scheme, an individual loan applicant will submit self-
certificate/affidavit as proof of income.
4. Customer declaration undertaking
5. Additional PMAY Application form

The eligibility is dependent on the income group you fall in.
Income Group Annual Household Income
EWS Up to ` 3 Lacs
LIG ` 3.01 to ` 6 Lacs
MIG 1 ` 6.01 to ` 12 Lacs
MIG 2 ` 12.01 to ` 18 Lacs

For EWS and LIG, it is mandatory for a female to be the property owner. In certain exception cases,
the lender may inform you. Also, the applicant or its dependents should be a first time home buyer
and should not own a pucca property at the time of availing the scheme.
The subsidy offered is dependent upon the loan amount and the income group you fall in. Applicants
with income up to ` 6 Lacs, can avail a maximum subsidy of `2.67 Lacs.
Applicants with income up to `12 Lacs, can avail a maximum subsidy of
`2.35 Lacs.
Applicants with income up to `18 Lacs, can avail a maximum subsidy of
`2.30 Lacs
Income Group

Subsidy on
maximum Loan
Amount

Interest Subsidy
(%)

Maximum Subsidy
Tenure
(In years)

Max. Subsidy
amount
Up to ` 3 Lacs ` 6 Lacs 6.5% 20 ` 2.67 lacs
Above ` 3 Lacs
up to ` 6 Lacs ` 6 Lacs 6.5% 20 ` 2.67 lacs
Above ` 6 Lacs
up to ` 12 Lacs ` 9 Lacs 4% 20 ` 2.35 lacs
Above ` 12 Lacs
up to ` 18 Lacs ` 12 Lacs 3% 20 ` 2.30 lacs

The documents required are very basic like:
 KYC Documents & Photograph
 Aadhar Card is mandatory
 Salary slip or Certificate & updated bank statement for salaried applicants
 Income Tax Returns of last two years and bank statement for self employed applicants
 Self-certificate/affidavit as proof of income

 Customer declaration undertaking
 Additional Application form​