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PMAY CLSS - How the Credit Linked Subsidy Scheme Works

PMAY CLSS - How the Credit Linked Subsidy Scheme Works?

23 Aug 2019
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 With an aim to provide affordable housing for the economically weaker class in our country, the Government of India launched the Pradhan Mantri Awas Yojana in the year 2015. The PMAY scheme aims to eliminate the slums in urban as well as rural areas and has already selected a total of 2508 towns and cities from over 26 states of our country. The government aims to build over 10 million houses for the economically poor class by the year 2022 under this scheme. With the implementation of the third phase of the scheme already started in April 2019, the target does seem achievable as envisioned.

 

What is PMAY CLSS (Pradhan Mantri Awas Yojana Credit Linked Subsidty) Scheme?

 

The PMAY Credit Linked subsidiary Scheme or the PMAY CLSS scheme is one of the key components under the Pradhan Mantri Awas Yojana. Under the CLSS scheme, people belonging to the economically backward classes in our country can avail subsidy on their home loan interest rate, making affordable housing a reality for them.

 

Who is eligible for PMAY CLSS Scheme?

 

The CLSS scheme is primarily aimed towards the upliftment of the weaker economic class in our country. People belonging to the following three economic categories can avail the benefits under the PMAY CLSS scheme-

  • Economically Weaker Section (EWS)- Individuals with an annual income of less than INR 3 lakhs

  • Lower Income Group (LIG)- Individuals with an annual income of less than INR 4 lakhs

  • Mid Income Group (MIG)- Individuals with an annual income between INR 6-12 lakhs.

Apart from the EWS, LIG and MIGs section of the society, the benefits of the PMAY subsidy can also be availed by people belonging to backward classes, scheduled class, and scheduled tribes.

While fulfilling the above-mentioned income criteria is important to avail the benefits of the PMAY scheme, the CLSS scheme also needs the applicant to fulfill some other home loan eligibility criteria, such as

  • The applicant must not have an existing home in his/her name

  • The family member of the applicant (spouse, either of the parents or sibling) should not have an existing home in their name

  • One of the co-owner of the allocated property under the scheme must be a female

  • The applicant should not have availed any housing benefit from any other Central or State Government housing scheme.

  • The property against which a home loan rate subsidy is availed must be within the 2011 census statutory towns.

     

How does the PMAY CLSS work?

 

CLSS for Economically Weaker Sections and Low-Income Group

  • Individuals belonging to the economically weak or low-income group can avail subsidy on their interest rate up to 6.5%.

  • The total tenure for this subsidy on your home loan can extend up to 20 years

  • At the time of availing the home loan, individuals belonging to this category can directly approach any bank or non-banking financial institution to get the incentive credited in their account. Subsequently, these loan-providing institutions can lower the home loan emi as per the initial credited value.

  • This initial credit value can be used for several purposes such as putting the down payment, construction of the house or making home renovations or repair.

  • Women applicants, people belonging to minorities, senior citizens, etc. are given preferential treatment under the scheme.

 

PMAY CLSS for Mid-Income Group

The Mid-Income Group can be classified into two groups :

  • To avail MIG1, your income should be between 6-12 lakh rupees per year

  • To be eligible for MIG2, your annual income should be in the range of 12 to 18 lakh rupees per year

Individuals belonging to the MIG I category can avail home loan interest subsidy up to 4% while those belonging to the MIG II category can receive a subsidy of 3%. However, the home loan tenor for both groups can be extended up to 20 years.

 

How PMAY Interest Subsidy is calculated under PMAY CLSS?

 

Depending on the income group that the applicant belongs to, the interest rate can be calculated according to the prescribed subsidy rate by the government. For instance, a person belonging to the MIG II category who has availed a home loan of INR 32 lakhs for a period of 20 years, can avail the benefit of 3% subsidy. This means that an amount of INR 12 lakh can be availed by him/her as subsidy under the PMAY CLSS scheme.

To calculate the subsidy amount as per the income category under the CLSS scheme, an applicant can make use of online home loan EMI calculators.

 

How to apply for the CLSS scheme?

 

  • Step 1: Contact your loan provider and check whether he/she is recognized under the CLSS scheme.

  • Step 2: Once you get a confirmation for the same, you can convey to them about your intentions of availing a home loan under the CLSS scheme.

  • Step 3: If you fulfill all the eligibility criteria set under the scheme, you would be asked to fill the CLSS form.

  • Step 4: Upon the submission of your CLSS form and the necessary supporting documents (Aadhar Card, Income Proof, etc.), your application would be assessed by the loan provider.

  • Step 5: After the successful assessment, the loan provider will disburse the home loan amount in the applicant’s account.

  • Step 6: Once the amount is disbursed, the loan provider will then approach the respective nodal agencies to start the process of granting subsidy under the CLSS scheme as per your eligibility.

 

If you are someone that falls under any of the above-mentioned income categories and fulfill all the other prescribed CLSS eligibility criteria, you must apply for the Pradhan Mantri Awas Yojana scheme and make the dream of owning your home a reality!

For further details, visit us at Finserv Markets! The Bajaj Finserv home loan on Finserv Markets is recognized under the Pradhan Mantri Awas Yojana and offers additional benefits of reduced EMIs and interest rates up to 6.93%. Moreover, the borrower can also enjoy other benefits such as flexible repayment options, complimentary value-added services, and home loan balance transfer and top-up on their home loans.

You can also get to know the perfect CIBIL score for home loans. Also, you can check your eligibility for home loan with the help of house loan emi calculator.

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