Pradhan Mantri Awas Yojana - Subsidy on Home Loan Interest Rates 2017
There is a great news for home seekers, the central government has announced more subsidy in home loan interest rates under the Prime Minister's Housing Scheme. During his speech to the nation on December 31, 2016, Prime Minister Narendra Modi announced a subsidy in interest on the home loan under the Prime Minister's Housing Scheme.
Under this scheme, the amount of home loan increased from 6 lakh to 12 lakh and subsidy at the interest rates would be 4%.
PMAY Home Loan Interest Rates / Subsidy 2017
There is a great news for home seekers, the central government has announced more subsidy in home loan interest rates under the Prime Minister's Housing Scheme. During his speech to the nation on December 31, 2016, Prime Minister Narendra Modi announced a subsidy in interest on the home loan under the Prime Minister's Housing Scheme.
Under this scheme, the amount of home loan increased from 6 lakh to 12 lakh and subsidy at the interest rates would be 4%.
PMAY Home Loan Interest Rates / Subsidy 2017
| Subsidies Explained | Earlier Scheme (2015) – CLSS for EWS/LIG | Revised Scheme (2017) – CLSS for MIG | |
|---|---|---|---|
| Loan Amount | Up to Rs. 6 Lakh | Up to Rs. 9 Lakh | Up to Rs. 12 Lakh |
| Eligibility Criteria | EWS (Annual income of Up to Rs. 3 Lakh) and LIG (Income of up to Rs. 6 Lakh per annum). Women to be the co-owner along with the beneficiary. | MIG 1 – Up to Rs. 12 Lakh per annum | MIG 2 – Up to Rs. 18 Lakh per annum |
| Subsidy Calculation for a loan tenure of up to 15 years | 6.5% | 4% | 3% |
| Subsidy Amount | Rs. 2.2 Lakh for a loan of 6 lakh | Rs. 2.35 Lakh for a loan of Rs 9 Lakh | Rs. 2.3 Lakh for a loan of Rs. 12 Lakh |
| Interest Rates and Subsidy | |||
| Interest Rate | 10.5% | 8.5% | |
| Loan Amount | Rs. 12 Lakh | Rs. 9 Lakh or More | Rs. 12 Lakh or More |
| Amount Eligible for Subsidy | Rs. 6 Lakh | Rs. 9 Lakh | Rs. 12 Lakh |
| Subsidy Rate | 6.5% | 4% | 3% |
| Subsidy Amount | 2.2 Lakh | 2.35 Lakh | 2.3 Lakh |
With the increase in the loan amount under the Prime Minister's Housing Scheme, there will also be a considerable decrease in monthly installments. The central government will provide 4% subsidy instead of 6.5% subsidy on loans up to Rs 6 lakh and be giving 3% subsidy on home loan up to Rs 12 lakh. The home loan under PMAY can be taken for a maximum period of 20 years. The government has also included two new middle-income groups under this scheme.
At this time, home loans are available from banks and non-banking financial companies (NBFCs) at approximately 9% interest rates. After interest disbursement of 4%, the effective interest rate goes up to 5%, which is significantly reduced in EMI.
PMAY home loan account of interest rate
For example, a person takes a loan of 9 lakh rupees for 15 years, and at a lower interest rate of 4%, his savings are Rs 2,011, so that his monthly installment goes down from Rs 9,128 to Rs 7,117. And likewise, with a 3% lower interest on the loan of 12 lakh rupees, there is a monthly saving of Rs 2,044 in installments.
Prime Minister Housing Scheme - Online application for urban is being invited through CSC's and official website pmaymis.gov.in.
The central government has also announced to give up to 3% discount on the interest of home loan upto Rs 2 lakh in the year 2017 under the Pradhan Mantri Housing Scheme Rural.
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