MIG Homebuyers under PMAY (Urban) – Rs. 2.5 lakh Interest Subsidy on Home Loans

Published Date - 28 March 2018 09:03:42 Updated Date - 31 March 2018 06:41:21

Prime minister Narendra Modi, on the eve of new year, had announced an interest rate subsidy scheme on home loans. It is expected that this move, will provide a huge boost to the realty sector. Under the scheme, the interest subsidy of up to 4% would be allowed for loans up to Rs 9 lakhs an up to 3% for loans up to Rs 12 lakhs.

Ministry of Housing and Urban Affairs has made an amendment on 15 March 2018 to PMAY (Urban) which specifies the effective date of different changes under Pradhan Mantri Awas Yojana.

This interest subsidy will benefit thousands of people from MIGs who dreams of their own home. Accordingly, govt. wants to realize its mission of “Housing for All by 2022”.

Objectives of the Pradhan Mantri Awas Yojana (PMAY)

  • To ensure that the poorer sections of urban India can live under a roof of their own.
  • To provide financial support to people who can’t bear the entire cost of building a residential property.
  • To offer houses to the Economically Weaker Sections (EWS) of the society.
  • To bring both public and private sector together in a bid to improve the fate of the nation’s urban poor populace.

MIG Homebuyers Interest Subsidy on Home Loans – Application

All the candidates who wants to avail this 2.5 lakh Interest Subsidy must fulfill the following conditions:-

  • This Interest Subsidy on Home Loans is applicable only for Medium income Group Families in Noida and Greater Noida Region.
  • All such families whose annual income is less than Rs. 18 lakh per annum are applicable.
  • In addition to this, only the houses bought after January 2017 are eligible.

As per amendment in PMAY on 15 March 2018, UP govt. has brought all the cities including Noida and Greater Noida under Credit Linked Subsidy Scheme (CLSS) for MIG (w.e.f 1 January 2017).

Availing Interest Subsidy – All the eligible homebuyers needs to visit their bank and make reference of 15 March PMAY Urban Notification. Afterwards, banks will ask the people to fill a separate form along with their photograph and other documents. After successful verification of the account and documents, banks will provide interest subsidy on home loans upto Rs. 2.5 lakh.

Central govt. has already informed and issues guidelines to the concerned agencies and primary lending institutions like HUDCO and National Housing Bank. This move will also address the concerns of the house owners. As per the official notification, housing ministry specifies that there is a need to clearly specify effective dates for different amendment under PMAY Urban to eliminate operational difficulties.

Need For Interest Subsidy of MIG Homebuyers

Earlier the MIG and lower income group homebuyers in Noida and Greater Noida were unable to receive the benefits of interest subsidy. So, UP govt. and Central govt. looks into this issue and finally UP govt. has sent the names of these 2 cities for approval. Central govt. has approved the names of these 2 cities under CLSS component of PMAY Urban in March 2018.

As per the official sources, around 92,000 home-buyers have already got this interest subsidy including 22,000 MIG beneficiaries.

Who can apply for the subsidy benefit?

The subsidy benefit will be available only to first-time home buyers, who do not possess a home anywhere else in the country. Earlier, the subsidy was available for loans up to Rs 6 lakhs but now, it has been increased to Rs 9 lakhs and Rs 12 lakhs. While the subsidy scheme has been welcomed, people are also hoping that the government will also increase the size limit (carpet area) of the property, to get the benefit under this scheme.

Who will benefit from the interest rate subsidies?

The lower interest rates are likely to prove beneficial to the low-income group (LIG) and middle-income group (MIG) buyers. Experts point out that the interest subsidy, will be allowed up to the loan limit of Rs 12 lakhs and above this limit, you can avail the non-subsidised loan. It means, if you are looking for a home loan  of Rs 20 lakhs, then, you will be eligible for a subsidy benefit of up to Rs 12 lakhs at 3%, whereas the remaining loan amount of Rs 8 lakhs would be non-subsidised.

Pradhan Mantri Awas Yojana Eligibility Criteria

In order to avail a house or financial reinforcements from the government, every applicant needs to meet the eligibility criteria set by the PMAY committee. Prospective applicants have been branched into six distinct groups


Eligibility Details

Economically Weaker Section (EWS)

People who earn an annual household income less than Rs.3 lakh come under the EWS category. However, an applicant claiming to be from EWS needs to provide relevant proof to the government to ascertain their claims.

Light Income Group (LIG)

People that fall under LIG category usually have an annual household income ranging between Rs.3 lakh to 6 lakh. Again, to be eligible for consideration, they need to provide sufficient proof of their economic standing.

Medium Income Group (MIG1)

Those who earn an annual household income below Rs.12 lakh fall under the MIG1 category. These people can avail loans of up to Rs.9 lakh for the construction of a residence.

Medium Income Group (MIG2)

Individuals earning an annual household income between Rs.12 to Rs.18 lakh will fall under MIG2 of the PMAY scheme. These people can avail loans of up to Rs.12 lakh.


People hailing from minority groups like SC/ST/OBC will fall under minorities. To be considered under the PMAY scheme, these people need to meet to provide relevant caste and income certificates.


Women belonging to EWS/LIG categories will be considered if they apply under the PMAY scheme.

Besides this, there is a basic requirement an applicant has to meet. For instance, if the beneficiary is a family, it must comprise of a husband, wife, and unmarried children. Also, no person from the family should own a house in their name.

Leave Your Comment Here