What is the primary need of any citizen in India? It’s food, clothing and shelter. The Prime Minister of India recognizes this need and in his speech on New Year’s Eve said…..So many years have passed after Independence. Yet, the poor in our country, do not have their own home. Houses are out of the reach of even the middle class. The Government wants the poor, middle class and the neo middle class, to have their own home.
The answer…. Pradhan Mantri Awas Yojana…a scheme which aims to provide an affordable home, to all citizens in the country. So how do the poor and the economically backward in India, get their own homes? Read and find out.
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The Prime Minister had launched a scheme across the Nation, known as the Pradhan Mantri Awas Yojana. The aim of this scheme….Provide affordable housing to all citizens in India. This scheme was launched on June 25th 2015, to ensure that 2 crore houses are built across India. The scheme is expected to be completed by 2022. So who gets benefits under Pradhan Mantri Awas Yojana? The lower income group (LIG) and the economically weaker sections (EWS) of society, stand to benefit under the Pradhan Mantri Awas Yojana. Households having an annual income up to INR 3 Lakhs, are the economically weaker section. Households having an annual income between INR 3 Lakhs and INR 6 Lakhs, are the low income group.
If you are from a household (Husband, Wife, unmarried sons/daughters) which earns an annual income up to INR 6 Lakhs and do not own any pucca house (house made of cement, wood and steel), you get an interest subsidy through the credit linked subsidy scheme, which is a component of Pradhan Mantri Awas Yojana (Urban). The Pradhan Mantri Awas Yojana focuses on homes not houses. The Pradhan Mantri Awas Yojana will construct environment friendly, pucca houses in rural areas. These homes will have Toilets, LPG, Power and Water connections.
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A number of poor citizens, who live in rural areas of our country, migrate to urban areas in search of better job opportunities. These citizens are now the urban poor. Houses in Metros and even smaller cities, cost a lot. When would these citizens ever get an affordable home?
The Prime Minister in his speech on December 31st 2016, announced two new middle income categories under Pradhan Mantri Awas Yojana, in urban areas and one scheme for rural areas. The Pradhan Mantri Awas Yojana used to provide housing loans up to INR 6 Lakhs, to citizens of the lower income group and economically weaker sections, at a subsidized interest rate of 6.5%.
The Prime Minister in his speech on New Year’s eve, offered an interest rebate to low income and economically backward citizens, availing loans under this scheme. Home Loans which are taken in 2017, by the poor and middle class up to INR 9 Lakhs, will receive an interest rebate of 4%. Home Loans which are taken in 2017 up to INR 12 Lakhs, will receive an interest rebate of 3%. Loans which are taken in 2017 up to INR 2 Lakhs, for extension of housing in rural areas, will receive an interest rebate of 3%.
Most of the citizens in our country, avail home loans from public sector banks. Around 65% of home loans availed from public sector banks, are under the slab of INR 25 Lakhs. Now, banks charge a rate of interest around 8.8 - 12 % a year, for home loans.
Under Pradhan Mantri Awas Yojana, you get interest subsidy on loans taken for affordable housing, up to INR 12 Lakhs. Loans beyond this amount will not be subsidized. If you are from the lower income groups or economically backward sections of society and availing a home loan up to INR 12 lakhs, it makes sense to avail a home loan under Pradhan Mantri Awas Yojana, at very low interest rates.
Special preference will be given to women when it comes to allotment, under the Pradhan Mantri Awas Yojana. This makes Pradhan Mantri Awas Yojana, a pro-women scheme. Disabled and aged citizens will be given preference over the strong and will be allotted homes under Pradhan Mantri Awas Yojana on the ground floor.
Yes….Houses are very costly in metro cities. But….With the help of the Pradhan Mantri Awas Yojana, you could at least own a home, on the outskirts of a Tier 1 or Tier 2 city. Be Wise, Get Rich.
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