With Pradhan Mantri Awas Yojana, owning a home is not a far-fetched dream for millennials anymore as now they do not have to toil hard to save money for their first real estate investment.
Filled with unwavering enthusiasm, contagious energy, this tech-savvy millennial generation is at the forefront of India’s growth story. Off late, there’s been a considerable shift in the millennials’ mindsets. The young adults of the 21st century are shifting their focus from investing in depreciating assets to real estate. Pradhan Mantri Awas Yojana – Urban is a boon for all these millennials on the prudent path to financial security. With affordability as the focal point, PMAY has encouraged a large number of millennials to realize their dreams of becoming a home-owner.
Now, millennials do not need to wait any longer to save a substantial corpus to buy their home. Youngsters with few years of work experience can afford a home with the loan subsidy offered under PMAY-U. The loan subsidy, lowers the monthly EMI, ultimately taking the financial burden off their shoulders.
Let’s know more about the intricacies of PMAY-U, Credit Linked Subsidy Scheme (CLSS)
What is PMAY-U (CLSS)?
PMAY-U (CLSS) facilitates the needs of the middle-income group (MIG), economically weaker section (EWS), and lower-income group (LIG). The scheme allows a subsidy in interest rates at which a homebuyer takes home loans. The millennials receive a helping hand from the government in the form of a subsidy up to ₹2.67 Lakh.
Pradhan Mantri Awas Yojana – Urban Credit Linked Subsidy is only applicable for properties in Urban areas. The primary condition for PMAY-U is that the beneficiary must not own a home (an all-weather dwelling unit) anywhere in India at the time of loan application. This creates better chances of homeownership for youngsters/millennials who have just stepped into a new career and planning to make the first home buying of their life.
- The beneficiary could be a family of husband, wife, unmarried sons/daughters
- In the case of a married couple, either of the spouses or both together can own a house.
- An adult earning member, irrespective of the marital status, can be treated as a separate household
- Women Ownership is considered mandatory for EWS and LIG
- Applicants falling under EWS category are eligible for complete assistance under PMAY
- Applicants under LIG, MIG – I & II category are only eligible for the credit-linked subsidy scheme
PMAY – Income Eligibility Criteria
To be able to apply for PMAY, your household income range should meet the following eligibility criteria
- Economically Weaker Section (EWS) – Upto ₹3 Lakh
- Lower Income Group (LIG) – Upto ₹6 Lakh
- Middle Income Group I (MIG I) – Between ₹6 Lakh to ₹12 Lakh
- Middle Income Group-II (MIG II) – Between ₹12 Lakh to ₹18 Lakh
Also Note: – To reduce your EMI, you can opt for a longer home loan tenure, but for subsidy calculation purposes, the maximum tenure to be considered is 20 years.
How to Avail Subsidy Under PMAY?
Pradhan Mantri Awas Yojana Home subsidy is channelised through two central nodal agencies – Housing and Urban Development Corporation (HUDCO) and National Housing Bank (NHB). These institutions process the application of subsidy to the lending institutions, which further helps to avail the subsidy benefits.
- Just file a loan application and a declaration confirming that you meet the eligibility criteria
- Your lending institution makes the claim on your behalf and sends your details to National Housing Bank
- Nodal Agency thoroughly checks your application and approves the subsidy
- The lender received the subsidy amount and credits it to your home loan account
Owning a home is one of the biggest investments that give a sense of accomplishment and a feeling of incomparable financial security. While affordable housing tops the charts, the government offers a lot of other incentives like interest subsidy on home loans to income tax exemptions, which encourages young home buyers to take the plunge and make their first real estate investment.