Anxiety grips most home loan seekers especially when it comes to calculating the EMI outgoings. To comfort such borrowers, the Government has formulated the Pradhan Mantri Awas Yojana (PMAY) under the “Housing for All by 2022” National mission for urban housing. Through this scheme, a borrower can enjoy interest rate subsidy on the outgoing EMI. Read further to get a broad view of the eligibility criteria to avail the scheme.

Income criteria

It is broadly classified based on the annual family income of the borrower. The income categories are framed in 4 parts i.e. Economically Weaker Section (EWS), Low Income Group (LIG), Middle Income Group - I (MIG - I) and Middle Income Group - II (MIG - II) The maximum limit considering all the groups is Rs. 18,00,000.

Only a first time home buyer is eligible for PMAY

A PMAY beneficiary’s family is defined as the one which comprises the husband, wife and unmarried children. No person from the family should own a house in their name.

No PMAY is granted towards reconstruction of a house

You cannot avail the PMAY benefit if you already own a house and wish to demolish it and reconstruct the house. However PMAY is applicable to those who want to upgrade their ‘kutcha’ house to a ‘pucca’ house.

Are NRIs eligible for PMAY?

An NRI is eligible for PMAY if his/her annual family income is below Rs. 18 lakhs. The direct family member should not have availed for the PMAY scheme already and should not be the owner of a house anywhere in India.

An existing borrower of a home loan is also eligible for PMAY

A borrower falling under Low Income Group (LIG) or Economically Weaker Section (EWS) category and who has bought an apartment or constructed a new house on or after 25th June 2015 is eligible for PMAY. Similarly, any borrower, coming under the MIG category, also fulfilling the other required criteria and has bought/constructed the home or after 1st January 2017 is eligible for PMAY.

A home loan by far supports and helps you to fulfill your dream of owning a home. PMAY adds to its affordability by cushioning any stressful impact on the EMI outgoings by providing interest rate subsidy for its beneficiaries during the repayment of the loan.

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Disclaimer: This Article is for information purpose only. The views expressed in this Article do not necessarily constitute the views of Kotak Mahindra Bank Ltd. (“Bank”) or its employees. Bank make no warranty of any kind with respect to the completeness or accuracy of the material and articles contained in this Newsletter. The information contained in this Article is sourced from empaneled external experts for the benefit of the customers and it does not constitute legal advice from Kotak. Kotak, its directors, employees and the contributors shall not be responsible or liable for any damage or loss resulting from or arising due to reliance on or use of any information contained herein.