Govt. Schemes

Pradhan Mantri Awas Yojna- Housing for All

Objective of the Scheme

The Pradhan Mantri Awas Yojana (PMAY) aims to provide affordable housing to all eligible beneficiaries by 2024. It envisions building pucca houses equipped with basic amenities like water supply, sanitation, and electricity. The scheme is divided into two categories:

  1. PMAY (Urban): For urban households.
  2. PMAY (Gramin): For rural households.

How PMAY Operates

  1. Target Beneficiaries:
    • - Economically Weaker Sections (EWS): Annual household income up to ₹3 lakh.
    • - Low Income Group (LIG): Annual household income between ₹3 lakh and ₹6 lakh.
    • - Middle Income Groups (MIG-I and MIG-II): Annual household income between ₹6 lakh and ₹18 lakh.
    • - Rural households living in kutcha houses or lacking adequate housing.
  2. Application Process:
      1. Eligibility Check:
    • - Applicants must not own a pucca house in their name or their family’s name.
    • - Aadhaar is mandatory for identification.
      2. Registration:
    • - Online: Through the official PMAY portal.
    • - Offline: At Common Service Centres (CSCs) by filling out the application form.
    • - Provide details like name, income, family size, and current residence type.
  3. Subsidy Mechanism (Credit Linked Subsidy Scheme - CLSS):
    • - PMAY offers interest subsidies on home loans for constructing, purchasing, or renovating houses.
      • 1. Interest Rate Subsidy:
    • - EWS/LIG: Subsidy of up to 6.5% on loans up to ₹6 lakh.
    • - MIG-I: Subsidy of up to 4% on loans up to ₹9 lakh.
    • - MIG-II: Subsidy of up to 3% on loans up to ₹12 lakh.
      • Loan Tenure: Up to 20 years.
    • - The subsidy amount is directly credited to the beneficiary’s home loan account, reducing the EMI burden.

Construction of Houses:

  1. Under PMAY-Gramin, financial assistance is provided directly to beneficiaries for constructing houses.
  2. House design depends on local climate and geographic conditions, ensuring sustainability.

Examples

Let’s consider a person named Ravi, who is a first-time homebuyer, living in an urban area.

Step 1: Eligibility Check

The borrower belongs to the Lower Income Group (LIG) category, which includes families earning between ₹3 lakh and ₹6 lakh annually. According to PMAY, LIG category families are eligible for a subsidy on home loans.

    To qualify for PMAY, Ravi must meet the following basic criteria:
  1. His annual household income is within the eligible range.
  2. He doesn't own any pucca (permanent) house.
  3. He is a first-time homebuyer.

Step 1: Eligibility Check

Ravi decides to buy a house worth ₹5 lakh in an urban area. He approaches a bank or a housing finance company to apply for a home loan.

    To qualify for PMAY, Ravi must meet the following basic criteria:
  1. Loan Amount: ₹5 lakh
  2. Loan Tenure: 20 years
  3. Interest Rate: 8% per annum (before subsidy)

Step 3: Subsidy Calculation

Under PMAY for the LIG category, Raviis eligible for an interest subsidy of 6.5% on his home loan for a tenure of 20 years. This means that Raviwill pay less interest on the loan compared to regular home loan interest rates.

    Let’s calculate the subsidy:
  1. Loan Amount: ₹5 lakh
  2. Interest Subsidy: 6.5%
The interest subsidy of 6.5% would be deducted from the home loan interest rate, so the borrower will pay an effective interest rate of 1.5% (8% - 6.5%) on his loan.

Step 4: Financial Impact
  1. Loan without PMAY Subsidy: At an 8% interest rate, the borrower’s monthly EMI would be around ₹4,200 for a 20-year loan.
  2. Loan with PMAY Subsidy: At an effective 1.5% interest rate, the borrower’s EMI would drop to about ₹2,200 for the same tenure.
Thus,the borrowersaves ₹2,000 every month, which significantly reduces his financial burden.

Step 5: Final Housing Benefit

Through PMAY, the borrowernot only gets financial assistance via the subsidy, but he also benefits from a more affordable loan structure, allowing him to own a home much sooner than he would have without the scheme.

Additionally, if the borrower is part of a specific target group such as a woman head of the household or from a backward community, she might receive additional benefits or priority under the scheme.

Step 6: Completion of Housing

With the subsidy and affordable home loan, the borrowercompletes the construction of his new house in a few years. He/She repays the loan through easy EMIs, supported by the reduced interest rate under PMAY.

Key Takeaways:

  1. Eligibility Criteria: Income categories (EWS, LIG, MIG) are crucial in determining eligibility for PMAY subsidies.
  2. Subsidy: The scheme offers an interest subsidy, reducing the EMI amount significantly.
  3. Affordable Housing: PMAY helps people like Ravi, who would otherwise struggle to afford a home, by providing them with financial assistance and making housing affordable.

This mechanism not only helps people buy their own homes but also stimulates economic growth by creating demand in the housing sector.

How You Benefit:

  1. Direct Subsidies: The interest subsidy significantly reduces the cost of homeownership. For example, an EWS beneficiary taking a ₹6 lakh loan for 20 years can save approximately ₹2.7 lakh on interest.
  2. Affordable Housing Projects: The government incentivizes developers to build affordable housing projects under PMAY guidelines. Beneficiaries can purchase homes in these projects at subsidized rates.
  3. Focus on Women: Houses under PMAY are registered in the name of a female member or jointly with her, empowering women in households.
  4. Infrastructure Improvements: Houses include basic facilities like toilets, water connections, electricity, and LPG.

Eligibility Criteria:

  1. PMAY (Urban):
    • - Applicant must belong to the specified income groups (EWS/LIG/MIG).
    • - The family should not own a pucca house in India.
    • - Preference is given to women, senior citizens, differently-abled individuals, and minorities.
  2. PMAY (Gramin):
    • - Families living in kutcha houses or houses with zero/one room.\n
    • - Listed as eligible in the Socio-Economic and Caste Census (SECC) 2011.

Steps to Apply:

  1. Online Process:
    • - Visit the PMAY official portal: pmaymis.gov.in.
    • - Select the relevant scheme (Urban or Gramin).
    • - Enter Aadhaar details and fill in the application form.
    • - Submit after verification.
  2. Offline Process:
    • - Visit the nearest CSC with Aadhaar, income proof, and other required documents.
    • - Fill out the PMAY application form.
    • - Pay the nominal registration fee.

Subsidy Example:

  1. Scenario:
    • - Loan Amount: ₹6,00,000 (20 years tenure).
    • - Interest Rate: 8.5% (without subsidy), 2% subsidy applied for MIG-II.
    • - Subsidy Benefit: Around ₹1.8 lakh credited upfront, reducing loan EMI and effective interest cost.
  2. State-Specific Guidelines
    • - States may have additional beneficiary lists and priorities based on local needs.
    • - Rural areas focus on housing for all beneficiaries listed in the SECC database.

FAQs

  1. Q- Who can apply for PMAY?
    Ans- Any EWS, LIG, or MIG family without a pucca house in their name.
  2. Q- What is the loan limit under the scheme?
    Ans- There is no upper limit on the loan, but subsidies apply only to specific limits (₹6 lakh, ₹9 lakh, ₹12 lakh).
  3. Q- Can I apply for both Urban and Gramin PMAY?
    Ans- No, the scheme applies either to rural or urban beneficiaries based on location.
  4. Q- Are there specific projects for PMAY?
    Ans- Yes, affordable housing projects are built under PMAY guidelines.

For more details and to apply, visit the official PMAY Portal: pmaymis.gov.in.

For any queries regarding the Pradhan Mantri Awas Yojana (PMAY), you can contact the following toll-free helpline numbers:

  1. National Housing Bank (NHB): Toll-Free Numbers: 1800-11-3377 / 1800-11-3388 PMAY-MIS
  2. Housing and Urban Development Corporation (HUDCO): Toll-Free Number: 1800-11-6163 PMAY-MIS

These helplines are available to assist you with any PMAY-related inquiries or concerns.

Additionally, for more information, you can visit the official PMAY (Urban) website: pmay-urban.gov.in

Feel free to reach out to these contacts for assistance with your PMAY-related questions.