Interim Budget 2024 – PMAY News:

India’s commitment to affordable housing received a significant boost with Finance Minister Nirmala Sitharaman‘s announcement in the Interim Union Budget 2024-25. The government has earmarked Rs 80,671 crore for the Pradhan Mantri Awas Yojana (PMAY), a flagship scheme that epitomizes the nation’s ‘Housing for All’ vision.

This enhanced allocation, up from the previous budget’s Rs 79,590 crore, highlights the government’s resolve to address the urban housing crisis. PMAY, since its inception in June 2015, has been pivotal in providing ‘pucca’ houses with essential amenities to eligible beneficiaries, primarily targeting low and middle-income groups.

In an innovative move addressing the housing needs of the middle class, a section often caught in the housing affordability gap, the government plans to roll out specific schemes. This initiative will assist those living in rented accommodations, slums, chawls, or unauthorized colonies, enabling them to purchase or construct their own homes.

The Budget’s highlight is the ambitious target of setting up two crore affordable houses over the next five years. This target builds on the success of PMAY-Gramin, which has been close to achieving its three-crore rural housing goal despite COVID-19 challenges.

A notable aspect of PMAY-Gramin is its focus on empowering women, with 70% of the houses being allocated to female beneficiaries. The scheme offers financial assistance of Rs 1.20 lakh in plain areas and Rs 1.30 lakh in hilly regions, shared between the central and state governments in a 60:40 ratio.

As the nation gears up for sustainable development and improved productivity, the Budget’s focus on housing is strategic. By ensuring affordable housing, the government aims to enhance living standards and foster inclusive growth.

The PMAY’s extension to December 31, 2024, to complete sanctioned houses by March 31, 2022, is a testament to its ongoing commitment. This move is expected to address the urban housing shortage effectively and promote homeownership, especially among women.

For more information on PMAY and its various facets, visit the official website here.

In conclusion, the Interim Budget 2024 marks a significant step in India’s affordable housing journey. By bolstering PMAY and introducing targeted schemes for the middle class, the government renews its pledge towards ‘housing for all,’ ensuring that every Indian has a place to call home.

Pro tip: If you are planning to buy or construct a new home in 2024, then you can get a home loan interest subsidy of up to Rs. 2,67,000 under the PM Awas Yojana. Check your eligibility with our PMAY Subsidy Calculator.

The Pradhan Mantri Awas Yojana (PMAY) is India’s flagship scheme for empowering women of India. The Prime Minister of India, Shree Narendra Modi, introduced this PMAY scheme for women on 25 June 2015 with a vision of housing for all with water, electricity, a kitchen, and a toilet.

The Credit Linked Subsidy Scheme (CLSS) under the Pradhan Mantri Awas Yojana (Urban) aims to provide interest subsidies on home loans for economically weaker sections (EWS), low-income groups (LIG), and middle-income groups (MIG). The subsidies reduce the effective loan burden and monthly EMI payments for beneficiaries. The scheme offers a 6.5% subsidy for EWS/ LIG on loans up to ₹6 lakhs and 3-4% for MIG on loans up to ₹9-12 lakhs. The National Housing Bank (NHB), HUDCO, and SBI are central nodal agencies managing the PMAY scheme.

The government is also building affordable homes for the urban and rural population of India who fall under the Economically Weaker Section (EWS), Low Income Group (LIG), and Middle-Income Groups (MIG-1 and MIG-2).

Along with women applicants, widows, transgenders, and women with disabilities are given more preference under the PMAY scheme for women.

However, many factors decide your PMAY eligibility, such as your annual family income, home carpet area, and others. Our PMAY Subsidy Calculator can help you check your eligibility and know your exact PMAY subsidy amount.

Here’s everything you need to know about the Pradhan Mantri Awas Yojana for ladies.

If you are planning to buy or construct your first pucca home, you can significantly reduce costs and save even more by applying to the Pradhan Mantri Awas Yojana for females. The PMAY Urban scheme comes with special interest rates and perks only for women.

In addition to this, many leading banks and NBFCs offer extra benefits to women home loan applicants. Let’s learn more about the Pradhan Mantri Awas Yojana benefits for ladies in 2024.

What are the Pradhan Mantri Awas Yojana benefits for women?

• Affordable Home Loan Interest Rates: Under the Pradhan Mantri Awas Yojana, a woman can avail of a home loan at the lowest interest rate, starting from 6.95% per year. However, the home loan interest rate for women depends on many factors, such as her CIBIL score, whether she is a working professional, etc.
• Home Loan Interest Rate Discount: Women housing loan applicants also get an additional home loan interest discount of around 0.05%.
• PMAY Subsidy: The PMAY scheme mandates that at least one woman from each family must be a registered co-owner of a house. If a woman is a co-owner, she can get a PMAY subsidy of up to Rs. 2.67 lakhs on the interest part of the borrowed home loan.
• Home Loan Interest Rebate Under PMAY: Women from Economically Weaker Sections (EWS) and Lower Income Groups (LIG) can receive a 6.5% discount on loans up to Rs. 6 lakh.
• Stamp Duty Discount: When women home buyers apply under the PMAY scheme, they can get a 1-2% stamp duty concession on residential properties in certain states of India.
• Property Registration Discounts: Women homebuyers can receive reduced registration fees, which usually range from 1% to 4% of the property cost.
• Property Tax Concessions: Women are also eligible for lower property taxes on properties registered in their names.
• Flexible Home Loan Repayment Tenure: Women applicants can avail of the home loan for up to 20 years (240 months).
• Zero Pre-Payment Charges under PMAY: Women applicants don’t need to worry about prepaying any amount other than regular EMIs to bring down the EMIs further. The PMAY scheme comes with the advantage of no pre-payment charges under this scheme.
• Tax Benefits: Women owners can claim a deduction of up to Rs. 1.5 lakh on the principal and Rs. 2 lakh on the interest part of the housing loan. Couples who co-own and both have incomes can save up to Rs. 3 lakh on principal and Rs. 4 lakh on interest part.

How to apply for Pradhan Mantri Awas Yojana online?

A woman applicant looking to buy her first pucca home or construct a house can apply for PMAY online by following these simple steps:

• Land on the official website of the Pradhan Mantri Awas Yojana.
• Look for the ‘Citizen Assessment’ tab and select ‘benefit under the other 3 components’.
• Feed your 12-digit Aadhaar Number. Once it gets verified, then you can proceed to the next page of the application.
• The Government of India uses applicants’ Aadhaar as a verification parameter to prevent the system from being defrauded.
• On the next page, you will need to provide your personal details. It should be followed by information like the state of residence and existing residential address. You also need to add the family’s head and other similar information as asked.
• Once done, you can now submit the application.

Women home loan applicants are being given preference by the Government of India. This way, if you apply for a home loan under PMAY, then you may get speedy approval. In turn, it can help you fulfill your aspiration of moving or constructing your dream home fast.

But you need to hurry, as PM Awas Yojana scheme is set to end this December 2024. Use our Home Loan EMI Calculator to plan your finances and monthly expenses better.

If you want to know more about the RERA Act, then this post will provide more input. Read on!

What is the RERA Act?

RERA stands for Real Estate Regulation and Development Act. The Indian Parliament passed this act in 2016. The principal motive of this act is to safeguard home buyers, along with boosting real estate industry investments.

RERA is available in every state of India. It has been implemented to regulate the real estate sector. It has also emerged as a body for the reporting and solution of property-based issues about builders and buyers.

Why was RERA implemented?

For a long, the Indian real estate sector was suffering from discrepancies between builders and home buyers. Homebuyers were finding it tough to get the delivery of their homes on time. But even builders were taken to court to sort out issues.

Hence, to address all these issues, RERA was implemented. It provided a sense of security and uniformity to Homebuyers and transparency to real estate developers.

RERA is available all over India in all states and union territories. A builder needs to inform their Homebuyers about contraction progress. And they also need to tell them the exact date of possession.

With RERA in place, home buyers are now confident that they can move into their new home on a specified date.

What benefits does RERA offer to the real estate sector?

Curtails Project Delays

The primary benefit that RERA offers is keeping away real estate project delays. Yes, when a builder starts a project, it just can’t continue for ages. It has to be completed within a specified time. Thus, when any real estate project starts, it is now mandatory for all builders to register it under RERA for tracking.

RERA Comes With Small Regulatory Authorities

The powers of RERA are not contained in a single body. It has been divided into many bodies to overlook many aspects of real estate. Each of them is accounted to look after real estate development in India’s every state and union territory.

RERA Applies To All Types Of Properties

Be it a residential or a commercial property, everything comes under the umbrella of RERA. The regulations that RERA provides are intended for the protection of the interests of developers and buyers in India.

Offers An Increased Level Of Transparency And Accountability

Owing to the rules and regulations of the RERA Act in India, many things have changed for good. Yes, the real estate industry has been able to bring about more simplicity and responsibility in its tasks among realtors.

Right To Information

Under the RERA Act, every home buyer has the right to know the updates about the ongoing projects of the builder that he/she has invested in. The information includes layout plans, completion and the status of completion. And the real estate developer can’t deny them this vital information. 

What benefits does RERA offer to home buyers?

Standardized Carpet Area Of The Home

Earlier, every builder has its own method of calculating the carpet area. But it was the base of every one of them to determine the price of a property. Hence, two builders calculating the same home may measure it 1200 sq ft and 1400 sq ft.

With the RERA Act now live, it will save Homebuyers from all confusion. RERA signifies the cost of the property as carpet area X rate per square meter. RERA also defines a carpet area as the usable area of an apartment. It excludes areas that are covered by a balcony, verandah, external walls, and an open terrace. Thus, now builders are not able to manipulate the price of a home, and you get more out of your investment.

Buyers Do Have Right In Case Of Bogus Assurance

Is there any mismatch in the commitments made by the real estate builder and the projects that are being delivered to you? If yes, then you can withdraw from it. Yes, you can get a full refund on the entire amount/advance as paid. The interest, along with the claim for compensation, can be made by a home buyer.

No Advance Payment Of More Than 10% To Be Made

RERA also provides clarity when it comes to the advances made for the purchasing of an apartment. If you are a home buyer, then you don’t need to make more than 10% of the advance. Before you get the sale agreement, you can just pay up to 10% and nothing more.

Grievance Redressal Made Easy

In case if you have any complaints against the builder, then you can approach your state RERA authority. It is provided with the power to deal with it swiftly. For example, if you have an issue with your new flat in Pune, then you will need to address your grievance to MahaRERA. 

How will RERA affect Homebuyers and real estate developers?

RERA has been implemented in almost all states and union territories of India. And it is sure to impact Homebuyers and builders. Hence, it will be useful to check out how it is going to affect both. Take a look:

RERA effects on Home buyers

• With RERA in place, now every builder will need to abide by the rules and provide details of the projects that they are going to start. The best part is that any addition, in this regard, needs to be updated on a regular basis. As a result, Homebuyers can be sure of everything and know when the project will complete.

• Under RERA, builders don’t have any authority to charge for the super built-up area. They are lobbies, balconies, lifts and stairs. They can only charge you for the carpet area/area enclosed by walls.

• About 70% of the money towards the charge for building an apartment/home by builders will now need to be kept in a separate account. It means that such an amount needs to be used only towards the ongoing projects and not others. When that happens, you can easily expect the delivery of the home that you want to buy on time and without delays, unlike times before the start of the RERA.

• RERA relies on the timely finish of all ongoing projects. What If there is a delay on the part of the builder? Then the builder will need to pay 2% interest over MCLR of SBI on the delay period.

• Once the apartment is given possession, it is up to you to report any construction and other defects under a period of 5 years. In this case, the real estate developer will need to work on all and get it resolved.

• If a home buyer lodges a complaint against the builder, then the developers will need to resolve it within 2 months.

• Without informing 2-3^rd of the Homeowners, a builder is not authorized to make alterations in the settings of the buildings. Once a large number of home occupants have no issues, then only any such changes can take place.

• RERA does not allow real estate developers to take more than 10% as advance from prospective home buyers.

• In case if you come to know that there is an issue in the title deed, you can simply ask for immediate compensation from builders.

RERA effects on real estate developers

• If a real estate developer is planning to have projects with an area more than 500 square meters, then it needs to be brought under RERA. It is also true if there is a plan to include 8 or flats by the builder.

• As discussed earlier, a deposit of 70% (taken from home buyers) needs to be deposited in bank accounts. It means that real estate developers are not entitled to indulge in any fraudulent transactions. It means that all money spent/paid towards the construction of new homes/apartments will be accounted for.

• All builders and Homebuyers are engaged under one model sale agreement.

You are now aware of the basics of the RERA Act and how it safeguards the rights of Homeowners and builders.

If you are looking to buy a first pucca home, then you can apply for a home loan under the Pradhan Mantri Awas Yojana.

Anyone earning between Rs.6 lakh and Rs.18 lakh with a valid Aadhaar number can avail an interest subsidy of up to 6.5% on a loan of up to Rs.12 lakh. This way, you can end up saving up to Rs.2.67 lakh and pay reduced EMIs.

You can also use the PMAY Subsidy Calculator to know your exact interest subsidy on the availed home loan. What’s more, it can also provide you with readjusted EMIs after deductions.   

In this article, you’ll find out if it’s a wise choice to avail of a personal loan for the home loan down payment. You’ll also find out when you should use a personal loan.

What is the down payment for a home loan?

Banks and NBFCs will provide housing finance only 80-90% of your house value, whereas the remaining 10-20% downpayment needs to be arranged on your own. 

Let me explain to you with the help of an example: Imagine you’re planning to buy a house worth Rs. 30 lakh; then banks and NBFC will provide a home loan of around Rs. 24 to 27 lakhs. You will need to arrange the remaining amount of Rs. 3 to 6 lakhs as the minimum down payment for a home. 

Pro Tip: The more you can pay as a down payment for a home purchase, the less the home loan EMI amount will be.

However, many homebuyers may not have the funds to arrange for the down payment for a home. And to fulfill their needs, they resort to availing a personal loan.

Is it good or bad to apply for a personal loan for a downpayment on a home purchase?

Many people take personal loans to either repay their ongoing home loans or arrange a down payment for a home. But is this a good or bad idea?

To understand this, you need to first know what a personal loan is and when you should avail it.

What Is The Purpose Of A Personal Loan?

A personal loan is an unsecured loan that is provided to you to meet your immediate needs. It is given for a short tenure ranging from 1 to 5 years. And it charges high interest as lenders have a high risk of defaults. Most banks and NBFCs charge personal loan interest rates between 9% and 24%, depending on your CIBIL score and other factors.

People with a healthy CIBIL score above 750, a good loan repayment history, and a good employment record get an instant personal loan at the lowest interest rate.

But if you don’t have any of these good records, then you’ll get a personal loan at a higher interest rate. This will lead to a higher EMI amount.

Overall, a personal loan is a good option only to meet your urgent requirements when you don’t have any other choice.

Does Applying For A Personal Loan For A Down Payment For A Home Make Sense?

Usually, banks or NBFCs offer personal loans with around 10.50% to 24% interest rate per year.

If you struggle to pay the EMIs on a personal loan used for a down payment on a home purchase, you could face serious debt problems. This is because home loan EMIs are usually more affordable, being secured against your property. However, when you add the higher EMIs of a personal loan to this, it can become difficult to manage both payments effectively.

No Wonder Availing A Personal Loan For Arranging For A Home Loan Down Payment Is A Bad Idea:

• A personal loan comes with a higher interest rate.
• An expensive alternative for making a home loan down payment
• It comes with a tenor of 12 months to 60 months. And it means paying bigger EMIs.
• Home loan EMIs + personal loan EMIs = Larger debt-to-income ratio.

The bottom line:

It is not wise to avail of a high-cost personal loan to repay low-cost home loan EMIs for a down payment on a home purchase.

Using your insurance policies and other securities to take a low-cost loan against them is a better way to arrange a down payment amount quickly.

If you have been dreaming of buying your own home for ages, then you can fulfill your wish easily! The Government of India started a Pradhan Mantri Awas Yojana scheme in 2015, which aims to provide affordable houses to everyone who meets PMAY eligibility criteria. Under the PMAY scheme, you can get a home loan interest subsidy of up to Rs.2,67,000.

But you need to rush because this amazing home loan interest subsidy scheme ends on 31st January, 2024.

So check your Pradhan Mantri Awas Yojana eligibility using our PMAY Subsidy Calculator for free and make your dream home wish come true.

If you want to buy your first-ever home, we would like to congratulate you! It is because you are thinking of reaching one of the key milestones in your life. The construction or purchase of the first home is indeed a matter close to every person’s heart. While the first-ever home is unquestionably a bundle of happiness, it is also a high-ticket investment. Hence, you need to be extra cautious and make sure you are not making first time home buyer mistakes.

To help you make your dream home a reality, we have created a first time home buyers guide, “16 things to check before buying a new home.” Make sure you go through this home buyer checklist before you even start your dream home buying process.

It will help you make the right decisions and approach them smartly without hitting roadblocks.

16 Tips for first-time home buyers:

1. What are your requirements?

When you venture out to buy your first home, you will find no shortage of attractive real estate properties with stunning features. Most of the leading builders will lure you with their glossy brochures and offerings that may excite you to go for it. But you must focus on opting for a property that makes sense for your current and future needs. Hence, ask yourself why you are buying a home – is it for self-use or investment?

Based on your needs, you can then break down your needs into the following elements:

Size Of The Home

If it is for your family, then you should assess if it can suffice your current and future needs. If it is for a small family, then having an extra room for guests may be a good option. Investing in a home for renting and other purposes should not be too big or too small.

You should also look for amenities that your new house is offering – it is up to decide on a home that falls under budget, mid-level, and luxury levels.

2. Location preferences:

Many people buy affordable homes, but they are too far from city limits, and commuting between them becomes a daunting task. Hence, you should always buy a home in a location that provides you with all the basics, such as:

Proximity to ATMs, supermarkets, Parks, Public Transport channels, Hospitals, Schools, Colleges, Railway Stations, and airports must be preferred.

Living in the heart of the city will help you access every service without wasting your precious time commuting.

3. What about home possession?

Some builders may take time to give you possession of your home. Hence, you need to be sure of that before purchasing. RERA rules can now help you get the home possession on time. However, if you purchased your new home during or right before the COVID-19 outbreak, then you may get your home possession after some delay. The Coronavirus had some serious impacts on real estate and many other businesses.

4. Determine your budget for the home purchase

The next thing is being aware of the cost you will need to bear for the construction or the purchase of the new home. You also need to consider monthly expenses you are going to manage apart from home loan EMIs. That’s why we always advise people to check their home loan EMI first using an online home loan EMI calculator. This will help you plan your monthly budgets better, giving you a clear picture of how much you are going to pay towards the borrowed house loan amount and other day-to-day expenses.

If you have enough money to purchase your dream home without any finances, then you can do that, but it’s not advisable to put your entire savings into purchasing a home. As per many financial and investment advisors, instead of using your entire savings for home purchases, you should take advantage of a housing loan from banks or NBFCs and put your savings into good investment options like mutual funds, stocks, etc.

In case you don’t have enough savings, banks or NBFCs will provide you with housing finance for around 80-90% of your home cost, whereas the remaining 10-20% of the funds, you need to arrange on your own. 

Pro tip: Don’t take a personal loan for a downpayment on a home purchase.

5. Know the resale value and rental rates in the area

Your home is an investment that you can liquidate later to meet many needs. Hence, it is significant to know how much resale value your new house will get. The same is true for buyers who are doing that for rental purposes. You can consult a real estate property expert to help you with this. 

6. Buy your home from a known builder

Your home is a big investment, and you can’t take it lightly. Hence, you should ensure to buy it only from a reputed builder. Before finalizing a property dealer, you must know about its history and performance records. You can get it online on real estate review sites. Once you are satisfied, only then you should go ahead with the purchase. It will also help you get the loan approval for a new home or construction quickly. It is because lenders are aware that a builder is reputable enough or not.

7. Approach a builder with a pre-approved home loan offer

If you have a healthy CIBIL score and a good repayment and employment history, then lenders provide you with pre-approved loan offers. It helps you avoid many complexities of the loan and fasten the entire process. Hence, you can check out whether a lender offers you a pre-approved home loan offer. If yes, you can approach your builder and negotiate a lower price for your new home. When they know that you already have a loan offer, they may not want to lose a customer. And they may oblige with the reduced home price.

8. Parking is a must

The new home that you want to buy must have parking space for your 2 or 4-wheeler. Many times, there is little or no space for this. And it may hassle you later. Ensure that your builder is offering parking space for your vehicles, along with one for guest vehicles.

9. What about the AMC of the property?

If you buy a new home, you will be asked to pay the Annual Maintenance Charges. It will be an obligation on your overall outlays. Such charges are levied towards the upkeep of your home and the society where you live. If there are some issues, then this money is utilized for the same. Hence, you should be well informed about this charge before buying a new home.

10. Choose a suitable home loan lender

Lenders may attract you with many home loan offers. But you should also see if they offer a home loan at a lower interest rate, larger loan amount, tenor, and other benefits. Always check and compare home loan interest rates and other benefits. Make sure to bargain your home loan interest rate if you have a strong CIBIL score history.

Did you know that women get a discount on a home loan? That’s true. Women home loan applicants get a discount of up to 0.05 point basis on the home loan interest rates.

Plus, selected banks and NBFCs offer more benefits to the women home owners or co-owners under the PMAY scheme.

11. Know about extra costs along with EMIs

Other than home loan EMIs that you will need to pay, you may also need to manage some extra costs. It may be about foreclosure, prepayments, EMI defaults and late payment charges. Thus, you should ensure to know it beforehand to avoid surprises later.

12. Availing property insurance is a must

You may protect your property against several damages by availing proper insurance for it. It will cover you for any legal issues, the problem with its title, and some degree of damages and beyond. The premiums are well within your budget, and it will relax you for sure.

13. Try to pay a large portion as the down payment

No lender will finance the entire cost of your new home. And the maximum that it will cover will be under 80-90%. The remaining needs to be arranged on your own. And it is what is known as the down payment. The thumb rule says that you need to put at least 20% of the cost of the home as a down payment. It will help you pay interest + EMIs on the remaining 80%. But if you can pay more, then you can reduce the charges further.

14. Make way for loan approval and EMIs

Taking a loan means paying EMIs, and it will affect your monthly outlays. Hence, you should readjust your expenses so that you can pay timely EMIs. And your focus should also be on getting the loan approval. Having a CIBIL Score of 750+, consistent repayment, and employment history can help you. Also, having a lower debt-to-income ratio can help in getting approval for a large amount. If you have ongoing debts, then you should clear it off without applying for a home loan. Why? It will convince your lender to sanction a considerable loan amount.

15. Go for a home loan balance transfer facility

If you are an ongoing home loan borrower and want to reduce the loan burden, then you can switch to a new lender offering lower rates. It may help you pay reduced EMIs and save money. But your existing lender may charge 1% of the remaining balance as the processing charge to facilitate this. Thus, you should see if you can save when going for a balance transfer or not. Leading lenders can also offer you a top-up loan to cover your other needs when you opt for home loan refinance. It may come with a tenor as that of your home loan and help you pay smaller EMIs.

16. Opt for a home loan via the Pradhan Mantri Awas Yojana

The Pradhan Mantri Awas Yojana scheme (PMAY) lets you avail of a home loan interest subsidy of up to 6.5%, amounting to Rs.2.67 lakh. To apply for this home loan subsidy scheme, first, you need to check Pradhan Mantri Awas Yojana eligibility using the PMAY Eligibility Calculator and find the exact PMAY subsidy amount that you can get under the PMAY scheme.

Conclusion:

Purchasing your first home is a significant milestone that requires careful planning and consideration. By following these 16 tips for first-time home buyers, you can make informed decisions and avoid common first-time home buyer mistakes. From determining your needs and budget to selecting a reputable builder and understanding loan options, each step is crucial for a smooth home-buying experience. Remember to explore financial aids like the Pradhan Mantri Awas Yojana for additional support. With the right approach, you can turn your dream of owning a home into reality.

We hope you have found our first time home buyers guide resourceful. Now, you can start with the home-buying process and make your dream home come alive.

Do you have an existing home loan, or are you looking to apply for one? One thing is for sure: home loan EMIs will eat up your monthly budget for a long time.

Many people just like you search for easy ways to reduce home loan EMI. We always advise housing loan borrowers to check home loan EMI using the Home Loan EMI Calculator even before they apply for a housing loan because this will help them get a clear idea about how much they need to pay in monthly installments towards the home loan, and then accordingly, can manage their monthly expenses.

We also advise people to check Pradhan Mantri Awas Yojana eligibility using the PMAY Subsidy Calculator and find out how much PMAY subsidy amount they can get under the scheme.

Don’t worry; we have a number of ways that will guide you on how to reduce home loan EMI.

Tips for reducing home loan EMI for existing home loan borrowers

• Request For An Extended Tenor

If the home loan tenor means paying reduced EMIs, then it would be better to have the loan repayment tenor extended to lessen the EMI burden. But doing that would mean getting it restricted with your current creditor. And it may be considered as a rewriting norm. It may further affect your loan credibility and CIBIL Score. But you can still request your lender to give you an extended tenor. It can help you reduce your loan EMIs. If it does not, then you can always go for the home loan balance transfer facility.

• Go For A Home Loan Balance Transfer

If you are an existing home loan customer, then you can go for the home loan balance transfer facility at a lower rate. Opting for a home loan balance transfer from one lender to another may cost 1% of the existing outstanding as the processing charges. If you calculate the amount less than what you can pay as the processing costs, then you can go for it. What’s more, leading lenders also let you enjoy a top-up loan to meet other needs with the facility.

• Make Part-Prepayments Every Year

You can also make some partial prepayment towards your existing home loan every year. It will help you bring down home loan EMI’s interest component. This way, you will be able to pay off the loan in less number of years. But before you do that, ensure checking out the charges for availing the facility. Use our home loan part prepayment calculator to find out how much home loan interest you’ll save.

• Negotiate Home Loan Rates With The Repo Rate Cut

Many times, the Reserve Bank of India has cut the repo rate. It is done to make home loans and other debts affordable for borrowers. But that does not mean only new customers can make the most of it. Yes, you can request your existing lender to readjust your home loan rates to new rates. It can assist you in reducing your loan burden. But if it does not do, then you can always go for the home loan balance transfer to an obliging lender.

Tips for reducing home loan EMI for new home loan borrowers

• Go For A Longer Home Loan Tenor

New home loan borrowers can reduce their upcoming EMIs by going for a longer tenor. It will not only help reduce your loan EMIs but even increase your loan eligibility. But one thing to remember is that opting for a longer tenor will mean having debt on your head for a long time. You will also end up paying more interest charges. But you can manage that by making some prepayments and putting in a bigger down payment.

• Put Down A Bigger Down Payment

No lender will finance the entire cost of the home that you want to buy, and it may be between 80-90%. The rest needs to be arranged on your own. And it is what is known as the down payment. Most of the lenders would want you to put down at least 20% as the down payment. But you should try to put down as much of a down payment as you can. Why? It will help you start paying lower EMIs on the remaining amount. Suppose you pay a 40% down payment; then you will only need to worry about the remaining 60%. You can always stretch it for a more extended period and pay significantly reduced EMIs. What’s more, if you pay more as a down payment, then it assures the lender of your income. It sanctions the loan application faster, considering you won’t have issues in making timely EMI payments.

• Ensure To Shop Around For The Best Loan Rates

The next thing that can help you opt for reduced home loan EMIs is checking out multiple home loan offers of lenders. Why? It will help you find the best one that fits your needs and repayment capacity. You can do that by landing on a third-party site. This way, you can know the best available home loan offers and then pick one. It may help you go for the best rates on it and help you save on monthly EMIs.

• Try Putting It 1-2 Extra EMIs Per Year

If you are a salaried professional, then you must be getting your year bonus, along with the appraisal. You can use the bonus to put down 1-2 extra EMIs per year to reduce your home loan rates and pay lower EMIs. This way, you may be able to clear your loan some months/years before. You can also use the percentage of the appraisal to start paying increased home loan EMIs and reduce the burden.

• Make Lumpsum Payments Every 1-2 Years

Home loan EMIs are something that will continue to cough up a portion of your income for a long. But if you have some policy or ventures maturing, then you can use the returns to make lumpsum payments towards it every 1-2 years. This way, you will end up saving on interest charges and pay lower EMIs.

• Go For A PMAY Home Loan And Save On Interest Subsidy

The next thing is that you can apply for a home loan via the Pradhan Mantri Awas Yojana (PMAY) and save up to 6.5% on your home loan interest. This way, you can save up to Rs. 2.67 lakh on interest charges as per your income group. If you are earning between Rs. 6 lakh and Rs. 18 lakh, then you can avail of a home loan of up to Rs.12 lakh to save. The loan amount above Rs. 12 lahks won’t be subsidized. You also need to be aged between 24 and 60 and have a valid Aadhaar number for being eligible. Also, it must be your first pucca home in India to apply for the PMAY scheme. You can find all about Pradhan Mantri Awas Yojana here.

You are now aware of some easy ways to reduce home loan EMI that you can implement to lower your burden without worrying about monthly expenses. 

If you are running short of time and want to quickly get an overview of the PMAY housing subsidy scheme, then take a look at the key highlights.

Key highlights of the PMAY scheme:

Introduction to the Pradhan Mantri Awas Yojana scheme:

Our respected Prime Minister, Shri. Narendra Damodardas Modi initiated the Pradhan Mantri Awas Yojana in June 2015. The Central Government of India manages this Credit Linked Subsidy Scheme (CLSS). The PMAY scheme’s last date is 31 December 2024.

The PM Awas Yojana scheme aims to build affordable houses using eco-friendly construction methods for the poor people of India who belongs to Economically Weaker Sections (EWS), Lower Income Groups (LIG), Middle-Income Groups (MIG-1), and (MIG-2).

Under this CLSS scheme, the eligible beneficiaries from EWS, LIG, and MIG categories can receive a Home Loan Interest Subsidy of up to Rs. 2,67,280 for their first Pucca home purchase or construction.

If you are planning to buy or construct your first Pucca home, make sure to read first time home buyers’ guide.

Also, use our PMAY Subsidy Calculator to check your Pradhan Mantri Awas Yojana eligibility and find out how much home loan interest subsidy you can get under this housing subsidy scheme.

Components of the PM Awas Yojana:

The PM Awas Yojana is divided in 2 parts based onto the beneficiaries.

1. Pradhan Mantri Awas Yojana Urban (PMAY Urban)
2. Pradhan Mantri Awas Yojana Gramin (PMAY Gramin)

PMAY Urban (PMAY-U) Scheme – Features and Benefits

1. PMAYU scheme was started to help poor urban people in India.
2. This scheme provides a subsidized interest rate from 3% to 6.5% per year on the borrowed home loan over a tenor of 20 years to all recipients.
3. The PMAY interest subsidy is given to EWS, LIG, MIG-1, and MIG-2 beneficiaries based on their annual family income.
4. Eco-friendly construction ways and construction materials will be used to build homes.
5. Senior citizens and handicapped beneficiaries are to be given preference while allocating ground floors under the houses built by the Government.
6. The scheme is applicable in 4041 towns, with priority being given to Class-I 500 cities.
7. This Credit Linked Subsidy Scheme (CLSS) will be implemented in 4041 towns in 3-phases starting from April 2015.
8. Applicants will get a home loan interest subsidy of up to Rs.2,67,000. 

PMAYU Home Loan Interest Subsidy Offer Details

Who can apply to Pradhan Mantri Awas Yojana Urban?

1. People belonging to the urban poor society of India and slum-dwellers are also included under PMAY Urban scheme, provided they meet certain PMAY eligibility criteria.
2. The family of the beneficiary will comprise a husband, wife, unmarried daughters, and unmarried sons.
3. The family must not have a pucca home either in the name of the family or any of the family members residing in any part of India.
4. People falling under any of the below-mentioned beneficiary categories can apply to PMAY Urban scheme.

Pradhan Mantri Awas Yojana eligibility criteria

1. Only Indian citizens can apply for the PM Awas Yojana scheme.
2. Your annual family income should be under Rs.18 lakh.
3. Only people falling under the EWS, LIG, and MIG income groups can apply.
4. A woman must be the primary applicant or co-applicant in the PM Awas Yojana scheme.
5. The applicant will be eligible to buy only a new house under this scheme.
6. People already having a home are not eligible to apply for PM Awas Yojana.
7. The applicant or any of his/her family members must not have any pucca home in any part of India.
8. People belonging to Scheduled Castes or Tribes (SC or ST) are also eligible.
9. Under the PM Awas Yojana scheme, applicants who are handicapped or senior citizens will get special priority.
10. Your pucca house carpet area should be under 200 sq. meters.

Check your PM Awas Yojana eligibility using the PMAY Subsidy Calculator and know how much home loan interest subsidy you’ll receive.

What are the documents needed to apply PMAYU scheme?

You will need to furnish the following documents to apply for PMAYU. Different documents are required for a salaried person and for a self-employed applicant.

How to apply for Pradhan Mantri Awas Yojana scheme?

Follow the below steps:

1. Visit the official website of the Pradhan Mantri Awas Yojana – http://pmaymis.gov.in
2. Once on the website, look for the Menu section and search for the ‘Citizen Assessment’.
3. You will now need to enter your 12-digit Aadhaar Card number Example – 41XX 49XX 07XX.
4. After you have entered your Aadhaar details, the portal will then redirect to the application page.
5. On the application page, you will need to enter details such as personal information, income, existing residential address, and your bank account information.
6. Choose the ‘I AM AWARE OF’ option at the end of the page and then hit the ‘Save’ button.
7. After you click on the ‘Save’ option, a system-generated application number will be showcased that you will be able to save for references in the future.
8. You can now download and take a printout of the duly filled application form.
9. You will now need to submit the form at a CSC (Common Service Centre) office, along with the banks/ NBFCs/ other financial institutions with needed documents.

How to edit the PMAY application form after submission?

Follow the below steps in case you have made any mistakes while submission.

1. Go to the official website of the PMAY – http://pmaymis.gov.in
2. Feed your Application Reference Number (ARN) that was provided to you at the time of submitting the original form.
3. Enter your 12-digit Aadhaar number.
4. Click on the option that says ‘Edit’.
5. You can now edit your information in the application form and re-submit it.

How can you get Pradhan Mantri Awas Yojana home loan interest subsidy?

Here is how the PMAY home loan interest subsidy is credited directly to your loan account

1. You need to apply for a home loan from any of the listed institutions asking for a subsidy.
2. The lending provider will now review your loan application, and if you are found to be eligible, your application will now be sent to the Central Nodal Agency (CNA).
3. Post verification, if your application gets approved and there are no discrepancies, whatsoever, the CNA will credit the subsidy amount to your lending institutes loan account.
4. The subsidy amount will now be disbursed into your bank account by the lending partner. This way, your total loan amount will get reduced.
5. You can now start paying the home loan EMIs against the remaining loan figure.

Pradhan Mantri Gramin Awas Yojana (PMAY Gramin)

The PM Awas Yojana Gramin (PMAYG) was launched to provide housing for all by the year 2022. It is a rural housing development scheme of PMAY that aims to offer a 25 square meter pucca house with other basic amenities in a rural area of India.

Under this scheme, some State Governments can even provide the applicants with financial aid to buy land for landless beneficiaries.

The scheme is a revamped version of the Indira Awas Yojana that was launched in January 1996.

PM Awas Yojana Gramin scheme – Features and Benefits

1. An applicant can avail of a home loan of up to Rs.70,000 from banks and other shortlisted financial institutions.
2. The interest subsidy of PMAYG is 3%
3. The highest principal subsidy amount is Rs.2 lakh for the subsidy.
4. For the EMI payable, the maximum subsidy amount availed is Rs.38,359
5. The cost incurred for each house is to be shared in the ratio of 60:40 between Central and State Governments in plain areas – Beneficiaries will get up to Rs.1.20 lakh assistance for each house.
6. In Himalayan states, UT (Union Territory) of J&K and Northeastern states, the ratio is 90:10 with the financial assistance of up to Rs.1.30 lakh for each house.
7. The Center will provide 100% financing for UTs, including Ladakh.
8. The assistance of up to Rs.12,000 is provided for the construction of toilets under Swacch Bharat Mission – Gramin (SBM-G) in association with MGNREGS and other schemes.
9. The payments are disbursed through an online banking facility i.e. electronically into the bank account/post office accounts linked to Aadhaar.

PM Gramin Awas Yojana (PMAYG) eligibility criteria

1. Homeless families – People who don’t have pucca home for their family.
2. Families having temporary homes with 0 or 1 or 2 rooms but with Kutcha (temporary) walls and roof.
3. Households with an illiterate adult above the age of 25 years.
4. Families without a male adult member aged 16 and 59 years.
5. Families not having any adult person between the age bracket of 16-59 years.
6. Families with differently-abled members.
7. A family without any lands or pucca house and earning income from casual labour.
8. SC, ST, minorities and other society of India.

List of documents for Pradhan Mantri Gramin Awas Yojana application

1. Aadhaar Card
2. Consent number for the Aadhaar number to be used on one’s behalf
3. An MGNREGA-registered applicant with the job card number
4. Swachh Bharat Mission beneficiary member
5. Valid bank account details

How to apply for the PMAYG scheme?

1. Visit the official website of PMAYG – PMAY Gramin
2. Provide details as asked under the personal information section.
3. Upload the consent form needed to use the Aadhaar number.
4. Find the name of the beneficiary, PMAY ID and priority by clicking on the search button.
5. Click on the ‘select to register’ button.
6. The details of the beneficiaries will now be displayed post generation.
7. The remaining details of the beneficiary, such as the Aadhaar number, relation, ownership type can now be duly filled.
8. To use the Aadhaar number on the beneficiary’s behalf, the consent form will now need to be uploaded.
9. Add the account details of the beneficiary in the next section, like name and bank account details.
10. If you want to avail of a home loan, then select ‘Yes’ and feed the loan figure.
11. You will now need to provide the MGNREGA job card number in the next section and your (beneficiary’s) Swachh Bharat Mission number.
12. The concerned office will fill the next sections hereon. 

From where you can avail of the home loan under the PMAY scheme?

Affordable housing scheme is being supported by financial agencies of different statures in India.

If you are looking to borrow a home loan to fulfil your dream of building or buying your first pucca home, then you have many options to do that.

You can apply for a home loan under the PMAY scheme from Housing Finance Companies, Public Sector Banks, Private Sector Banks, and Regional Rural Banks.    

You are now aware of the Pradhan Mantri Awas Yojana Urban (PMAY Urban) and Pradhan Mantri Awas Yojana Gramin (PMAY Rural) schemes and their multiple aspects.

Check your PMAY eligibility using our online PMAY Subsidy Calculator and know how much home loan interest subsidy you can avail of under this scheme.

The Coronavirus (COVID-19) has affected everyone. Its effects are now being felt in the economy, automobiles, manufacturing, and more.

In the wake of COVID-19, the Government has already announced Rs.20 lakh crore packages. The RBI has also announced the extension of the loan moratorium to 31 August 2020. It has also slashed the repo rate twice to make loans affordable.

The Maharashtra Real Estate Regulatory Authority (MahaRERA) has come up with the force majeure. It now offers a COVID-19 harmed period from 15 March to 14 September 2020. Force majeure is a provision that offers short-term relief to a party from performing its sure-shot duties while under a contract. It is being seen as a nice move to ease Covid impact on real estate. 

The Pandemic has seen laborers reverse their migration to their hometowns, breaking the supply chain of construction materials. Hence, it is severely affecting the pace of real estate activities in Maharashtra and elsewhere.

MahaRERA has created this facility as the state has 25,000+ registered real estate projects, the highest number in India.

Under sections of MahaRERA, any registration of sale agreement due after 6 months can be extended beyond the period of Majeure.

Also, the possession date, as mentioned in the agreement, will be extended until this period is over.

Homebuyers can also demand any refund but after 1-month post the completion of the moratorium period.

While it is good news for realtors, Mumbai Grahak Panchayat has expressed concerns about safeguarding homeowners’ interests.

“It’s dubious if the interest of this force majeure is being given to realtors whose projects are already delayed. What if the builder is unable to give possession even after 1-month post this moratorium period is over. In such cases, homebuyers must not be denied interest in the ongoing lockdown period.” Shirish Deshpande, the Chairperson of the Mumbai Grahak Panchayat, was quoted as saying on the development.    

Shirish went on to state that MahaRERA has a duty to ensure that real estate does not take undue advantage of this relief. He also questioned the shield MahaRERA gives to homebuyers who are suffering from paying EMIs.

Deshpande also stated that realtors are not obliging. This is because many have stopped paying rent to rehabilitation members. He wanted MahaRERA to clarify this so that the interests of the homebuyers were also protected.

Advocate Naheed Carrimjee also shared his opinion on MahaRERA’s announcement of this resort. Here is what he has to say about the measures taken to ease COVID-19’s impact on real estate. “This (force majeure) may be in favor of both homebuyers and developers. But that should not be taken as an excuse by builders to delay rents to tenants in redevelopment projects.”

The ball is now in MahaRERA’s court. It should safeguard the interests of both parties in this unprecedented situation due to the Pandemic. 

For more such Pradhan Mantri Awas Yojana news, subscribe to PMAY Calculator.