A Brief Guide To Credit Linked Subsidy Scheme In India

A home is not a mere asset, but a place where you nurture your family and knit memories for life. As such, everyone dreams of owning a home, but putting this in action is often unachievable due to financial restrictions.

To help aspirants in realising their dreams, the government launched the Pradhan Mantri Awas Yojana (PMAY), a scheme that aims to offer affordable housing to all Indians by 2022. Initially, the scheme only covered the economically weak and low income segments of society.

However, PMAY introduced CLSS scheme that covers middle-income group too. Read on to know more about the credit linked subsidy scheme in India.

Eligibility Criteria for CLSS

  • CLSS is only available if you avail a home loan to purchase or construct a home
  • You or any member in your household shouldn’t own a ‘pucca’ house
  • Your household should include you, your spouse, and unmarried children
  • Married or unmarried earning members of the household are considered a separate household
  • You shouldn’t have availed assistance from any other government housing scheme

Income Criteria

Following are the three sections of society based on their income that the CLSS (credit linked subsidy scheme) covers:

  • Economically Weaker Section (EWS): Income less than Rs.3 lakh annually
  • Low Income Group (LIG): Income less than Rs.6 lakh annually
  • Middle Income Group I (MIG I): Household income between Rs.6 lakh to Rs.12 lakh annually
  • Middle Income Group II (MIGII): Household income is between Rs.12 lakh to Rs.18 lakh annually

Subsidy Limit

Based on your income, you will get an interest subsidy as follows:

  • EWS, LIG, and urban poor beneficiaries will get a 6.5% interest subsidy on a sanction of up to Rs.6 lakh to be repaid in up to 20 years. The total interest subsidy amounts to Rs.2.67 lakh.
  • MIG I beneficiaries will get a 4% interest subsidy of on a sanction of up to Rs.9 lakh to be repaid in up to 20 years. The interest subsidy amounts to Rs.2.35 lakh.
  • MIG II beneficiaries will get a 3% interest rate subsidy on a sanction of up to Rs.12 lakh to repaid in up to 20 years. The interest subsidy amounts to Rs.2.30 lakh.

Carpet area Limit

For each beneficiary section, the eligible carpet limit of the home in question is laid down as follows:

  • EWS: up to 30 square meters
  • LIG: up to 60 square meters
  • MIG I: up to 160 square meters
  • MIG II: 200 square meters

Other CLSS Facts

  • There is no limit on the maximum loan amount that you can avail
  • Interest on the loan amount beyond the above-mentioned subsidy limits is charged at non-subsidised rates
  • The subsidy is credited to your loan account via your lender
  • There’s no limit on the value of your property
  • CLSS is offered to women, backward classes, SC/STs, minorities and disabled applicants first to encourage homeownership

When looking for a Home Loan under benefits of pradhan mantri awas yojana (PMAY), apply with leading NBFCs to enjoy high sanctions of up to Rs.3.5 crore, affordable interest rates, flexible tenors up to 240 months, and more. They also offers a Flexi Hybrid facility under which you can borrow as you need and pay interest only on the amount utilised.

Further, you can choose to pay interest-only EMIs for up to the first 4 years and use the principal portion to meet other home buying expenses.

Bajaj Finserv has simple eligibility criteria and minimumdocuments required for a home loan that makes for quick approval so you can start realising your dream without any delay.

Author Bio:

Ayushi Choudhary is a passionate blogger. She has expertise in writing finance articles. She loves keeping herself up-to-date with the latest news and trends.

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