The Prime Minister of India has a dream. A roof over the head of every citizen of our country. A very ambitious scheme called "Housing for All by 2022" can make this dream a reality. The Government had launched a scheme called Pradhan Mantri Awas Yojana popularly called PMAY, in June 2015. This scheme was launched under the mission, Housing For All by 2022. The Government wants to build affordable pucca houses for all citizens in India. Pucca houses are made of stone, brick, cement, concrete and timber. These houses will have sanitation, water and electricity, round the clock.
PMAY was originally meant for the economically weaker sections of society (EWS) and the lower income group (LIG). It now covers the mid-income group (MIG). PMAY will change the lives of slum dwellers. Slum dwellers will have homes built in collaboration with builders and developers.
Now to the Big Question. Can you get a home under PMAY if your parents own a home? Let's find out. Want to know more on home loans? We at IndianMoney.com will make it easy for you. Just give us a missed call on 022 6181 6111 to explore our unique Free Advisory Service. IndianMoney.com is not a seller of any financial products. We only provide FREE financial advice/education to ensure that you are not mis-guided while buying any kind of financial products.
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What is credit linked subsidy scheme for EWS/LIG?
If you belong to the economically weaker sections of society (EWS) or Lower income group (LIG) and you avail a home loan from a bank or a Housing Finance Company, you are eligible for an interest subsidy at the rate of 6.5% for a tenure of 20 years or during the tenure of the loan, whichever is lower.
Home loans under credit linked subsidy scheme (CLSS), will be available for loan amounts only up to INR 6 Lakhs. If you avail a home loan more than this, you will have to pay the normal interest rates on the home loan.
What is credit-linked subsidy scheme for MIG?
The Government recently introduced the credit linked subsidy scheme for the middle income group. The middle income group MIG- I, comprises of households having an annual income of INR 6,00,001 - INR 12,00,000. The middle income group MIG- II, comprises of households having an annual income of INR 12,00,001 - INR 18,00,000.
If you belong to MIG- I, you get an interest subsidy of 4%, for a home loan up to INR 9 Lakhs. If you belong to MIG- II, you get an interest subsidy of 3%, for a home loan up to INR 12 Lakhs. Housing loans above INR 9 Lakhs and INR 12 Lakhs, are charged at normal interest rates.
The carpet area must be 90 sq mt for MIG- I and for MIG- II, it must be 110 sq mt. Carpet area is the area enclosed within the walls of your apartment.
1. Are you eligible to get a loan under PMAY?
Let me first answer this question. Who is not eligible to get a loan under PMAY? If you or any of your family members own a pucca house or you have availed central assistance under any housing scheme under the Government of India, you cannot get the benefit of PMAY.
Disappointed....Wait till you hear this. If you are an adult earning member, married or unmarried, you are treated as a separate household. You must not own a pucca house in any part of India in your name.
You can buy a new house, buy a house in the secondary market through repurchase, or even take a loan for the construction of your house under PMAY.
2. You stay in a rented house. Can you get the benefit under PMAY?
If you are married/unmarried and staying with your parents in a house owned by them, you can get the benefit of PMAY. You must be earning and not own any other house. If you are staying in a rented house in the same city as your parents, or another city and you are earning, you are eligible for the benefit under PMAY. You must not own a house in your name in any part of India.
Married and staying with your spouse in a rented apartment? You can enjoy PMAY benefits, even if your parents own a house, provided you don't own any house in India. You and spouse are eligible for a single house under PMAY, bought either in your name or jointly owned with spouse.
Yes, you can. Surprised...Let me enlighten you. The Government says, under the Housing for All by 2022, you are eligible for incremental or housing enhancements under CLSS (credit linked subsidy scheme).
If you meet the eligibility criteria, the bank or the housing finance company, cannot decline your application under PMAY, if you seek a loan for the addition of a room or a kitchen to your existing pucca home.
The Union Budget 2017 has given affordable housing, Infrastructure Status. This shows the Government is real serious and wants to promote affordable housing in India. It's time to get your dream home under PMAY. Be Wise, Get Rich.
Mr. C S Sudheer is the founder and CEO of IndianMoney.com – India’s largest Financial Education Company. He started his career with ICICI Prudential Life Insurance and later on worked with Howden India. After his brief stint in Howden India, he moved on and incorporated Suvision Holdings Pvt Ltd which is the sole promoter of IndianMoney.com. He aims to build a nation that is financially literate with investment savvy citizens.
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