What is PMAY (Pradhan Mantri Awas Yojana)?
Also called: PMAY-U 2.0, PMAY Urban, Pradhan Mantri Awas Yojana, CLSS, interest subsidy scheme
Families earning up to ₹9 lakh a year can get an interest subsidy on the home loan for their first pucca house under PMAY-U 2.0, the urban phase of the central government's housing scheme, approved in August 2024.
PMAY-U 2.0 runs through four routes: beneficiary-led construction on your own land, affordable housing in partnership with states and builders, affordable rental housing, and the Interest Subsidy Scheme (ISS). For most buyers of a flat, ISS is the part that matters. It replaced the earlier Credit Linked Subsidy Scheme, whose MIG categories closed in March 2021 and EWS and LIG categories in March 2022. Rural housing is a separate scheme, PMAY-Gramin.
Under ISS, the household must belong to the EWS (annual income up to ₹3 lakh), LIG (₹3 lakh to ₹6 lakh) or MIG (₹6 lakh to ₹9 lakh) category, and must not own a pucca house anywhere in India. The house should cost no more than ₹35 lakh, the loan can be up to ₹25 lakh, and the carpet area can be up to 120 sq m. The subsidy is 4% on the first ₹8 lakh of the loan over 12 years, up to ₹1.8 lakh, and it's credited to your loan account in five yearly instalments rather than paid to you.
Apply through the PMAY-U portal or your lending bank or housing finance company, which must be a registered primary lending institution. Aadhaar is required for every adult member of the household.
The subsidy is modest next to a full loan. Where it really helps is in towns like Indore, Nagpur or Jaipur, where a ₹30 lakh flat fits within the caps.
A Jaipur family earning ₹7.5 lakh a year buys a ₹32 lakh flat with a ₹22 lakh loan. Under PMAY-U 2.0's interest subsidy, up to ₹1.8 lakh is credited to their loan account in five yearly parts, reducing the principal.
Families apply after a relative has already added them as co-owner of a house elsewhere. Owning any pucca house in India, even a share, disqualifies the whole household.
Questions people ask about PMAY (Pradhan Mantri Awas Yojana)
Can I get PMAY subsidy on a home loan I already have?
Generally no. The PMAY-U 2.0 subsidy is meant for loans sanctioned under the new scheme from September 2024, and loans taken under the closed CLSS are not revived. Ask your lender whether your sanction date qualifies.
Does the house have to be in a woman’s name for PMAY?
Women's ownership is encouraged under the scheme, and some routes require it. Check the current conditions with your lender before you register.