After a long day’s work if there’s one place you can really relax in, it’s your home. Unfortunately, India is home to 78 million people who “cannot afford housing or are unable to maintain a regular and safe shelter”.
But with the rolling out of Credit Linked Subsidy Scheme (CLSS) under the Pradhan Mantri Awas Yojana (PMAY), owning your home has suddenly become more affordable for:
- Economically Weaker Sections
- Low Income Groups
- Mid-income Groups
Below are 7 important things you really should know about the credit linked subsidy scheme (CLSS) under PMAY if you’re a first-time home buyer.
- You’re (Most Likely) Eligible if You’re a First-Time Home Buyer
Do you know that you are eligible to take a home loan under CLSS if you meet these 3 conditions?
- You do not own a pucca house (yet) in your name, your spouse’s name or in the name of any unmarried children in India.
- If you’re married, either your or your spouse or both together (in joint ownership) are eligible for a single subsidy.
- Your family should not have availed of central assistance under any housing scheme from the Government or claimed any benefit under any scheme in PMAY.
- Who Can Qualify as a CLSS Beneficiary?
A beneficiary family under the CLSS comprises a husband, wife and unmarried children. However, an adult earning member – a regardless of marital status – can be treated as a separate beneficiary.
- Yes, There’s an Income Limit
The credit linked subsidy scheme (CLSS) covers people in the following income groups:
- Economically Weaker Sections (EWS) with an annual income not exceeding ₹3 Lakh
- Low Income Groups (LIG) with an annual income not exceeding ₹6 Lakh
- Mid-Income Groups (MIG) with an annual income between ₹6 Lakh to ₹18 Lakh
- All “Statutory Towns” Are Covered
CLSS benefits extend to all statutory towns as per the 2011 Census, as well as subsequently notified towns, including planning area as notified with respect to a statutory town. In other words, chances are good that no matter where you live in India, you will likely be eligible to enjoy the benefits of CLSS.
- Other CLSS Info You Should Know
The table below provides a snapshot view of the types of CLS Schemes, including eligibility conditions (income, carpet area), maximum loan and subsidy amount, validity period, etc.
|CLSS Type||Eligibility (Household Income)||Carpet Area-Max (sq. m.)||Interest Subsidy (%)||Max Loan Amount on For Subsidy Calculation||Scheme Validity||Max Subsidy (₹)||Woman Ownership|
|EWS||Up to ₹3 Lakh||30 sq. m.||6.50 %||₹6 Lakh||31/03/2022||₹2.67 Lakh|
|LIG||Up to ₹6 Lakh||60 sq. m.||6.50 %||₹6 Lakh||31/03/2022||₹2.67 Lakh||Yes *|
|MIG 1 **||₹6 Lakh – ₹12 Lakh||90 sq. m.||4.00 %||₹9 Lakh||31/12/2017||₹2.35 Lakh||Not Mandatory|
|MIG 2 **||₹12,00,001– ₹18 Lakh||110 sq. m.||3.00 %||₹12 Lakh||31/12/2017||₹2.30 Lakh||Not Mandatory|
* Woman ownership is not mandatory for construction or extension of your dwelling unit
** for MIG 1 & 2 loan should have been approved on or after 1-1-2017
- Interest Details You Should Know
- Interest Subsidy
- Will be available for up to of 20 years or your loan tenure, whichever is lower.
- Will be credited upfront to your loan account through your bank, thereby lowering your EMIs and effective housing loan amount by ₹2.30 Lakh to ₹2.67 Lakh (depending on your income).
- Max Loan Amount
- There’s no cap on your loan amount or the cost of your property.
- You can take a bigger loan (beyond the specified limits of ₹6 Lakh, ₹9 Lakh or ₹12 Lakh), but in that case non-subsidized rates of interest will apply (on loan amounts beyond your specified limit).
- Other Things You Should Know
You can take a loan under CLSS for new constructions, acquisition and addition of rooms like a bedroom, kitchen, toilet, etc. to an existing dwelling unit incremental housing. For more information on CLSS, do check out the website of the Ministry of Housing and Urban Poverty Alleviation.
Harsh Modi works as Director at Eden Group, a Kolkata based real estate company. A strong supporter of Pradhan Mantri Awas Yojana (PMAY) and the Credit Linked Subsidy Scheme (CLSS), Harsh strongly believes it will go a long away to provide affordable housing for those who need it most – and revitalize consumer