If you are looking to own a home of your own, under the Pradhan Mantri Awas Yojana (PMAY) scheme, there are only nine months left for you to arrange the amount for down payment, decide the location, builder, and the home loan lender.
The recently introduced, Credit Linked Subsidy Scheme (CLSS) for Middle Income Group (MIG) to be called CLSS for MIG will be for a period of one year starting 1.01.2017.
Let’s see who all are eligible for the MIG category, who all within a family can apply, how much is the subsidy in rupee terms and how does the subsidy impact the loan amount.
The middle-income earners
The new category MIG, introduced recently, will further comprise of two slabs. The Middle Income Group (MIG) – I will comprise of households having an annual income between Rs.6,00,001 up to Rs.12,00,000.
And, the Middle Income Group (MIG) – II will comprise of households having an annual income between Rs.12, 00,001 up to Rs.18, 00,000. So, effectively anyone earning between Rs 6 lakh and Rs 18 lakh per annum can avail the benefits of subsidized loans provided other conditions are met.
Who are all eligible?
The scheme is primarily aimed at providing housing for all. Therefore, understandably, all those who already own a home or any of their family member own a home, are kept out of the benefits of PMAY.
The rule says, “The beneficiary family should not own a pucca house and the beneficiary family should not have availed of central assistance under any housing scheme from Government of India.” A beneficiary family will comprise of husband, wife, unmarried sons and/or unmarried daughters. To avoid duplication, beneficiary family members have to provide their Aadhaar numbers while applying for the loan.
But, as per the guidelines, “An adult earning member (irrespective of marital status) can be treated as a separate household, provided that he/she does not own a pucca (an all weather dwelling unit) house in his / her name in any part of India.”
So, even if children (married or unmarried) are staying with their parents in a house owned by the parents (or on rent, in the same or another city), they can opt for PMAY provided they are earning and don’t own any other home.
For a married couple living on rent and even if their parents own a home, will anyhow is treated as a separate household. However, if they wish to avail PMAY benefits, they will be eligible for a single house, bought by either of the spouses or both in joint ownership.
Subsidy
In the MIG – I category, individuals will get 4 per cent interest subsidy on a loan amount up to Rs 9 lakh, and in the MIG – II slab category individuals will get a 3 percent subsidy on a loan amount up to Rs 12 lakh. If one needs an additional loan, the lender will prove it but the additional loans beyond the subsidised loan amount will be at a non-subsidised rate.
The impact
PMAY scheme for MIG buyers may not push up the demand for residential housing much. The benefit of Rs 2.3 lakh/Rs 2.35 lakh may not appeal much considering the cost of houses in the urban areas. The government may consider doing away with the area restriction of 90/110 sq mt to pep up the demand.
Conclusion
Affordable housing has been given infrastructure status in Budget 2017, which should aid developers in takings its associated benefits. But for a common man, the timely delivery of the house still remains a distant dream. For availing the benefits, the builders had to complete the affordable housing projects in 3 years but now (Budget 2017) have to complete in 5 years. Tread carefully and evaluate all the options before venturing out to explore the affordable housing segment, even if you are a first-time home buyer.
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