5 Important Benefits of Pradhan Mantri Awas Yojana

While buying a home is a big goal for many, rising real estate prices make purchasing an apartment an impossible endeavour for some. Therefore, to provide housing for all, the Government of India launched Pradhan Mantri Awas Yojana in 2015. Through the PMAY-Urban initiative, the Government aims to reach out to millions of Indians living in urban areas of India by 2022, especially to citizens belonging to the weaker sections of the society. One key way in which the Government is making affordable housing a reality is by providing an interest subsidy on a home loan under PMAY.

However, PMAY functions through multiple verticals and so, read on to about the know the top 5 PMAY benefits. 

Interest subsidies on home loans

To help the country’s urban poor finance new homes, PMAY offers economical home loan financing through the Credit Linked Subsidy Scheme (CLSS). Upon PMAY registration, depending on the category you fall under, you can avail a maximum interest subsidy of 6.5% on a home loan. 

• If you come under the Economically Weaker Section (EWS) or Low Income Group (LIG) category, you can avail a loan under PMAY and obtain an interest subsidy at a rate of 6.5%. The subsidy is applicable on a maximum loan of Rs.6 lakh.

• Similarly, you get an interest subsidy of 4% on a maximum loan of Rs.9 lakh, if you come under the Middle Income Group-I (MIG-I) category.
  
  

• If you belong to the Middle Income Group (MIG-II) category, you get an interest  subsidy of 3%, on a maximum loan of Rs.12 lakh.

As per the above-mentioned figures, EWS/LIG, MIG-I and MIG-II beneficiaries can obtain an interest subsidy of up to Rs.2.67 lakh, Rs. 2.35 lakh and Rs.2.30 lakh respectively.

Below is a table to help you understand how the 4 income-based categories differ.

Affordable housing for every section of the society

Under the Affordable Housing in Partnership (AHP) vertical of the Pradhan Mantri Awas Yojana scheme, the Government aims to build affordable houses in partnership with state governments and real estate builders. Under this scheme, states and Union Territories (UT) can commission housing projects for EWS beneficiaries, and avail financial aid of up to Rs.1.5 lakh from the Central Government for each EWS house. 

Additionally, for the urban poor living in slums, the PMAY scheme, under its ‘in situ’ rehabilitation component, promises to provide houses by using land as a resource. A slum rehabilitation grant of Rs.1 lakh, on average, would be made available for every house.

Financial aid for house enhancement or renovation

To qualify for PM Awas Yojana, the beneficiary family, which comprises of you, your spouse, and your unmarried children, must not own a pucca house in any part of the country. However, you can receive assistance through PMAY for an existing pucca house if the purpose is extension or renovation, for instance, to add a room, kitchen, or other basic facilities. 

Priority to women, minorities and disabled

Under PMAY, women, minorities, widows, senior citizens, disabled and transgenders are given first preference. For instance, LIG and EWS beneficiary families must register a woman as an owner of the property. In case of the MIG category, female ownership is desirable. Similarly, senior citizens and physically disabled beneficiaries will be given first preference for ground-floor houses in PMAY housing projects.

Houses constructed using eco-friendly material and latest technology

Another major benefit of the PMAY scheme is that the government will employ modern technology and make use of eco-friendly building materials to ensure less pollution and harm to the environment during construction. Green practices will also go a long way in building sustainable communities.

Of all the PMAY benefits, the CLSS initiative is particularly attractive as the interest subsidy provided is substantial. However, to obtain it you must take a loan that’s authorised to offer PMAY subsidies.