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How to Avail Home Loan Under PMAY

PMAY of Pradhan Mantri Awas Yojana is an initiative under the ‘Housing for All mission started by PM Narendra Modi in 2015. It is an interest subsidy scheme with the name ‘Credit Linked Subsidy Scheme’ (CLSS), for aiding in the purchase, extension, construction and improvement of houses. This scheme is made for people falling under the Middle Income Group (MIG), Lower Income Group (LIG) and Economically Weaker Section (EWS). The initiative aims at meeting the requirements of the rapidly growing urbanization and the housing demands in India.

With PMAY, the aim is to build about 2 crore houses for poor citizens in urban cities, by the year 2022. This mission is being funded and supported by the central government through the financial assistance of ₹2 trillion.

PMAY Subsidies

Another goal of the Pradhan Mantri Awas Yojana is to uplift and support people falling under the lesser privileged segment of this country. This is to be done by providing them with proper living arrangements through ‘housing for all’. PMAY offers the following subsidies to the people:

  • It offers an amount of ₹100,000 through a Central Grant, to every subscriber of the PMAY
  • For a credit linked subsidy at 4% is available to MIG-I for loan amount up to ₹ 900,000 and at 3% to MIG-II for loan amount up to ₹ 1,200,000. However, the banks can sanction home loans for more than ₹ 900,000- ₹1,200,000, but the subsidy will remain restricted to the same amount.
  • People falling under the LIG and the EWS are offered a subsidy through Credit-linked Subsidy Scheme (CLSS), which can be as much as 50%.

Eligibility Criteria

  • The beneficiary family should not own a pucca house (an all-weather dwelling unit) in any part of India neither in his/her nor in the name of any of his/her family member.
  • Married couple are eligible for a single subsidy in either of the spouse’s ownership or as a joint ownership under housing for all.
  • The beneficiary family should not have previously subscribed for any kind of central assistance in any housing scheme from the Government of India. They should also not have applied for any benefit under the PMAY
  • For MIG-I beneficiaries, the carpet area of the intended house under this PMAY should be up to 160 sq. mts. And for MIG-II beneficiaries, it should be up to 200 sq. mts.
  • People who have already taken a home loan under the housing for all scheme and have availed interest subvention benefits, but have later switched to another bank, will not be provided with the interest subvention benefits again.

Process for Applying for Home Loans under PMAY

  1. Firstly, you have to apply for a home loan from any bank or NBFC of your choice that fulfills your requirements and providing subsidy.
  2. Go to the Pradhan Mantri Awas Yojana official website and download the form for the subsidy scheme.
  3. Take a print out the form and fill in all the required details correctly and accurately.
  4. Search for an office near to your location and submit this form along with all the requested documents.
  5. If your application is deemed eligible for the scheme, it will be forwarded to Central Nodal Agencies (CNA).
  6. After your application is further approved, CNA will forward your application to the lender who will lend the required money to you.
  7. This subsidy amount will be transferred to your home loan account.

The plan is one-of-a-kind in India and it definitely has the potential to positively impact the neglected parts of our society.

Vikas Agarwal
the authorVikas Agarwal
Vikas Agarwal is an IIT-Varanasi graduate in Chemical Engineering. He is the Founder and CEO of - an investment advisory website. He is a Business Development Professional but a Value Investor at heart. He writes articles on Finaacle, which focus on simplifying the art of investing and the causes of human misjudgment when it comes to investing. He also shares his experiences as an investor and lessons from some of the greatest investors of all time.

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