Congratulations if you are all set to buy your first home on a home loan! Many people think of living in their own homes but are unable to fulfil their wish due to financial crunches and more.
However, the availability of the home loan facility has enabled a large number of people to fulfil their wish of purchasing their dream homes with many features.
When you avail a home loan to buy your home, you also need to repay the amount over a tenor which consists of the principal and the home loan interest rates. The combination of these may increase the cost of your home loan. Thus, every borrower should ensure to avail a home loan interest tax benefit so that it could be easy to pay affordable EMIs.
Nonetheless, if you don’t have any other property in India and willing to buy your first home, you can avail the benefits of the Pradhan Mantri Awas Yojana. Under the scheme, you can get a subsidy on home loan interest rate and make it affordable.
How to buy home under PMAY?
PMAY stands for Pradhan Mantri Awas Yojana which was launched in 2015 to build affordable houses. The plan is to build lakhs of affordable houses for the benefit of the first time home buyers under for the urban and poor population of the country.
Even people wanting to buy a first home with the help of the home loan can avail interest subsidy on it. People are categorized under the Economically Weaker Section (EWS), Lower Income Group LIG), and Middle Income Group (MIG 1 and MIG 2).
Pradhan Mantri Awas Yojana – Quick look at the eligibility
People belonging to Economically Weaker Section and Lower Income Group of the society, you can apply for a home under the PMAY scheme. You will need to fulfil some PMAY eligibility to get started such as:
✓You should not have a pucca house in your name or any other members of your family
✓Your family should consist of you, your spouse and unmarried children
✓If you are earning up to Rs.3 lakh annually, you are considered in the EWS section and people earning between Rs.3 lakh and Rs.6 lakh under LIG
✓People willing to avail the facility of the PMAY would need to submit the proof of income/submit the income
✓Since it’s also a scheme to empower women, women home buyers will be given upfront consideration as compared to males
✓Even disabled and senior citizens will be given priority over other applicants while applying for a home on the ground floor
How to get subsidy on home loan under PMAY?
If you don’t have the financial capacity to buy a home under the PMAY scheme or don’t fulfil the criteria of PMAY eligibility, you can apply for the home loan and get a subsidy on home loan interest rates under it.
You are eligible to apply for a home loan from selected commercial banks, non-banking finance companies (NBFCs), and even urban cooperative banks.
People borrowing a housing loan of Rs.9 lakh can avail an interest subsidy of 4%. If you want to avail a home loan of Rs.12 lakh, you can enjoy 3% interest rate subsidy.
Home loan buyers availing a housing loan of Rs.12 lakh and more will be out of the ambiguity of the Pradhan Mantri Awas Yojana. As a result, they will have to take out such loans at prevailing market rates and there won’t be any interest subsidy available.
The Bottom Line
With even the Government helping you to save on interest subsidy on the availed home loan, you can now avail home loan under PMAY and fulfil the wish of a home. You can apply for a home loan type online after assessing your needs and repayment capacity.
Bajaj Finserv offers pre-approved home loan deals on multiple financial products such as personal loans, home loans and more. You can unlock your pre-approved loan offer by entering some basic information.
