Pradhan Mantri Awas Yojana Guidelines

for income Rs. 3 – 6 Lakhs

Avail interest subsidy up to 2.67 Lakhs under PMAY – CLSS for EWS and LIG income
group

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In June 2015, Prime Minister Narendra Modi announced that India needs at least 2 crore
houses in the range of 5-15 Lakhs. This project was started under the name Pradhan
Mantri Awas Yojana(Urban). The Ministry of Urban Housing and Urban Poverty
Alleviation has been designated to over look this ambitious project.

The project is to be implemented in through four different verticals:

1. In – Situ rehabilitation of existing slum dwellers

2. Credit linked subsidy scheme
3. Affordable housing in partnership
4. Subsidiary for beneficiary led individual house construction/enhancement

The Pradhan Mantri Awas Yojana official website has all the details on the on the
initiative. You will also find updates, amendments and new announcements related to the
schemes on this website.

Out of the four verticals, Credit linked Subsidy scheme that offers discount on interest
rate for home loans.
The scheme is divided in to two categories:

1. Credit linked subsidy scheme for EWS/LIG

2. Credit linked subsidy scheme for MIG

A detailed post on the Pradhan Mantri Awas Yojana Credit Linked Subsidy Scheme
(MIG) for middle income group is available here. All those who earn between Rs.6-18
Lakhs a year fall under this category.

In this article, let’s take a look at the Credit Linked Subsidy Scheme for EWS/LIG.
This is popularly known as Pradhan Mantri Awas Yojana for Economically weaker
section and Pradhan Mantri Awas Yojana for Low income group.

Here are the features of the scheme at a glance:

 EWS LIG
Annual household
Rs.3 Lakhs Rs. 3-6 Lakhs
income
Maximum loan value
Rs. 6 Lakhs Rs.6 Lakhs
for subsidy
No processing fees for up to 6 No processing fees for up to 6
Processing fees
Lakhs loan Lakhs loan
Maximum loan tenure 20 years 20 Years
Subsidy on interest 6.5% 6.5%
Maximum interest
2.67 Lakhs 2.67 Lakhs
subsidy
Maximum carpet area
30 Sq Mtr (~323 Sq Ft) 60 Sq Mtrs (~646 Sq Ft)
eligible
Where can property be Any area deemed as town Any area designated as town
located under census 2011 under census 2011
Scheme open for
No last date as of now No last date as of now
applications till

Pradhan Mantri Awas Yojana eligibility for EWS/LIG groups

There are two important factors that make you eligible:

1. You should not own a pucca house anywhere

2. combined income of your family unit should be less than Rs.6 Lakhs a year

Other than that, here are some important points to note:

 The house you buy/build using a loan with subsidy, should be in the name of
female head of the family
o She can jointly own the house with the male head of the family
o Male head of the family can own the house if there is no female head
 The Government has directed banks to give preference to:
o Women borrowers
o Widows
o People belonging to SC/ST/OBC
o Minority groups
o Disabled people
o Transgenders

How to apply for Pradhan Mantri Awas Yojana EWS/LIG

When you want to take a loan and avail the benefit of this scheme, the first step is to find
a bank that has signed an MOU with the two nodal institutions – NHB or HUDCO
Then you need to apply for loan as usual, giving details of your income, property etc.
Additionally, you would need to give a letter declaring that you do not own
a pucca house anywhere.

Pradhan Mantri Awas Yojana application form and procedure

You can apply for interest rate subsidy in two ways:

1. Pradhan Mantri Awas Yojana online form – direct application for subsidy
2. Apply through bank or housing finance company

Pradhan Mantri Awas yojana Application form online

You can apply for subsidy online free of cost through http://pmaymis.gov.in. You can
also apply online with the help of officials at the Common Service Centre (CSC). They
would charge you a nominal fee of Rs.25 for this service.

You can locate the nearest CSC on this link

Here are the steps to apply for Pradhan Mantri Scheme online

Step 1
Start by selecting ‘benefit under other 3 components’

Step 2
Enter adhar details correctly
Step 3
Enter all other details correctly
Step 4
Save your application.

Your application process is now complete. You can track the status of the application on
the same website.

Once your application is processed, you can submit a print out to the local Municipality
or Nagar Palika office.

Pradhan Mantri Awas Yojana Application through bank

Applying for the subsidy through bank is a simple procedure too. You can apply for loan
and the benefit at the same time.
If you are eligible for the scheme you can select a bank from this list of banks that have
signed MOU for offering this scheme.

Inform the bank that you wish to avail benefit under the scheme and follow up regularly.
The whole procedure may take 2-3 months.

Home Loan Application and Documents Under Pradhan Mantri Awas Yojana
Since the procedure to apply is the same, the documentation is also the same as a regular
home loan application, with the exception of a declaration letter.
 1. Proof of identity – PAN card, Aadhar card, voter id card, Driver’s licence,
MNERGA number etc
2. Proof of address – Voter id, electricity bill, telephone bill, driver’s licence etc
3. Proof of category – SC/ST/OBC/Minority certificate
4. Proof of nationality – Passport, Aadhar Card, birth certificate
5. Proof of income – Form 16, Income Tax returns and bank statements, if any. In
case you don’t have any of these, you would need to provide a self declaration of
income.

Pradhan Mantri Awas Yojana Subsidy Calculation

You can get a up to Rs. 2.67 Lakhs as subsidy under the scheme.

This is calculated using a method called Net Present Value. An official Pradhan Mantri
Awas Yojana subsidy calculator is available on the websites on Pradhan Mantri Awas
Yojana and National Housing board. You could enter your loan amount to know how
much subsidy you are eligible for. The maximum loan amount you can enter is Rs.6
Lakhs.

How much loan can I take

You can build a house of any size and take a loan of any value. But when you apply for
subsidy, the benefit will only be on the first Rs.6 Lakhs.

Can I switch over home loan from another bank

Switch over and balance transfers are not eligible for subsidy benefit under the scheme.
You will also not be able to switch your loan from one bank to another after you take the
subsidy benefit.

However, switching your loan from one bank to another could save you lot of money too.
You can learn more about switching over home loan here.

How is interest subsidy paid under Pradhan Mantri Awas Yojana

The subsidy will be directly credited into your loan account. Here is how it works:
How much will I save on subsidy from Pradhan Mantri Awas Yojana
If you take a loan without the benefit of the scheme you pay a substantial amount as
interest

Particulars Amount
Loan value Rs.20 Lakhs
Interest rate 8.65%
Tenure 20 years
Equated monthly
Rs.17,547
installments (EMI)
Total interest paid
Rs.22.11 Lakhs
over 20 years

If you do take the benefit of the scheme, Rs.2.67 Lakhs will be credited into your loan
account at the start. This brings down the EMI immediately

Particulars Amount
Loan value Rs.20 Lakhs
Loan value after subsidy Rs. 17.33 Lakhs
Interest rate 8.65%
Tenure 20 years
Equated monthly installments (EMI) Rs 15,204
Total interest paid over 20 years Rs.19.16 Lakhs

Over 20 years, you would save nearly Rs.3 Lakhs.

Building a home is a large expense. You should use every possible option to save your
heard earned money. Credit Linked Subsidy Scheme is one such option that you must
utilise.

All the procedures have been kept fairly simple. Detailed information on the scheme,
calculators, online application forms are provided for easy access to the scheme. For any
assistance, including filling up the form you can visit the nearest Common Service
Center.

Here are some final points to keep in mind when you apply for Pradhan Mantri Awas
Yojana EWS/LIG

 Aadhar number is mandatory to apply for subsidy

 You can use the loan amount to buy/build a new home or repurchase an existing
house
 You can use the loan amount to extend your house with toilets, kitchen etc
 The house must be brick and mortar, i.e ‘pucca’ and must meet all safety and
hygiene standards set by authorities.