August 25, 2018 0 By theindianblogger

“Along with boosting the affordable housing segment of the country and meeting the home requirements of the economically weaker sections (EWS) and the low income group(LIG), the PRADHAN MANTRI AWAS YOJNA also acts like big saving for those looking to buy homes with home loans.”


This is a very promising scheme by the government that includes not only the construction of your home but also buying of home without disturbing your savings and sacrificing on the essentials of life. This program by the Indian government helps you to procure the basic necessity of life that is a house plus helps in saving in the long run.

1] Subsidy on I rate to cut EMI- Interest on home loan depends on quite many factors like the repo rate and marginal cost of fund based lending rate, of many. If the interest rate on home loan is high, the EMI will be high resulting in high cash outgo every month. Home loans are the commitments that are paid as EMIs for a period of 10 to 15 years or at times even more. Longer the tenor higher is the interest outgo. The interest charged by banks on home loans are 8-10% thus the interest and the total amount paid at the end of the tenor is high. Loans from non-banking finance companies can be procured but interest rate is charged there also.

However with PMAY there is interest subsidy on the home loan thus there is huge saving. As per the scheme people from the EWS and the LIG category who are to avail loan for a term of 15 years are offered a subsidy interest of 6.5% and 3% respectively. Middle income group beneficiaries get a subsidy of 4% on the amount of 9 lakh for term of 20 years.

Thus with the revolutionary scheme, of the home is acquired savings for the lower and mid-income group can be Rs. 1- 2.3 lakhs.

2] Green practices for the construction of homes- The PMAY goes one step ahead to help you save a lot of your hard earned money. The projects earmarked under the scheme adopt green practices for construction. Green houses are not only better in terms of quality but they also help to save in the long run. As per the ratings of Green Rating for Integrated Habitat Assessment (GRIHA), India’s own green building rating, accommodating a green house helps to save in:

> 25-30% saving in energy consumption

> 20- 30% saving in water consumption

> 50% less generation of waste

Thus the above savings can help to recover a major part of the expenses that were incurred in the purchase of the homes via the home loan. The green homes have eco- friendly windows and roofing materials. Thus they help in savings as their maintenance costs is also lesser. Importantly, they have positive impact on health and thus lowers the doctor and medical bills.

Final Verdict:

Thus with the subsidized interest rate on home loans, the PMAY is a boon for the EWS, LIG and MIG people who are intending to buy homes. Thus with the savings any other important expenses can be taken care off. Thus any amount saves is directed towards other financial goals like the higher education of children, wedding and many more. Having your own home is bliss and when this bliss comes with the benefit of savings, it is dream come true. Also the cherry on cake is the easy availability of home loans from the financial institutions under the PMAY 2018, subject to certain terms, ensure quick and fuzz free disbursal of loans, thus also saving the time and energy in procuring the loans.

As it is very promising project from the government to uplift the weaker sections of the society the conditions subject to which any person can derive the benefits of the scheme are as follows.

Besides this the applicant has to meet the concerned authorities. If the beneficiary is a family it must be husband, wife and unmarried children. Another aspect is that the no person should own a house in their name. The scheme applies only to them who do not own a puccahouse, it will include any major renovation that will result in up gradation from kuccha house to pucca house.

If you are looking for house under the PMAY then you need to be contacting any of the following primary lending institutes that can be either public or private sector banks, non- banking housing finance companies, regional and co- operative banks.

It is vision to get homes for all by the end of 2022, and government has granted loans to many and will continue to do so if the applicant fulfills all the conditions.