Build a House... get Rs. 2.5 lakh subsidy on loan

Shelter is one of the three basic needs of man. Everyone dreams of owning a house. Thankfully, the Centre has come forward to help. The Centre will bear some part of the burden of housing loans, raised by the poor and middle classes, by way of subsidy. Let us learn about this scheme...

Titled Pradhanamanthri Awaz Yojana, the scheme envisages subsidies on interests payable on housing loan, for various categories of income. Earlier, beneficiaries with an annual income of Rs. 6 lakh were the only ones who enjoyed subsidised interests rate. The new scheme has extended this to beneficiaries with annual income up to Rs. 18 lakh. In towns, some prominent building contractors are extending their own help to the beneficiaries under the scheme.

3 categories of income
The government has announced subsidised rates for three categories of annual income: Rs. 6 lakh, Rs. 12 lakh and Rs. 18 lakh. Different subsidy rates have been announced for the three categories. Earlier, any category of income used to get subsidy on the amount of loan availed. The government has set a limit on this. Also, the loan period should not be over 20 years.

Beneficiaries, with an annual income of Rs. 6 lakh, will get 6.5 per cent subsidy on interests on their housing loans. For example: If a beneficiary is paying nine per cent interest on housing loan, he will get a discount of 6.5 per cent under the scheme, and will be paying only 2.5 per cent as interest. But the subsidy can be availed only for Rs. 6 lakh loan amount. For example: If a beneficiary gets Rs. 10 lakh loan, he will get subsidy on interest for only Rs. 6 lakh. For the remaining Rs. 4 lakh, he has to pay as per the normal interest rates. Beneficiaries under this category will save Rs. 2,46,625 on interest.

Those with Rs. 12 lakh annual income, will get four per cent subsidy on interests. That too for Rs. nine lakh only. This category of beneficiaries save up to Rs. 2,39,843.
Beneficiaries with annual income of Rs. 18 lakh will earn three per cent subsidy on interest rate. The limit of subsidised loan amount is Rs. 12 lakh. These beneficiaries save Rs. 2,44,468 through subsidised interests.

Reduction in EMI
Easy Monthly Instalment (EMI) for all the three categories of people will reduce by at least Rs. 2,000. For the first category of beneficiaries, with annual income of Rs. 6 lakh and subsidy of 6.5 per cent on interest, EMI will be discounted by at least Rs. 2,219. For those with Rs. 12 lakh annual income, enjoying four per cent subsidy on interest, EMI will reduce by Rs. 2,158. Similarly, the third category of people will enjoy a discount of Rs. 2,200 on EMI.

The scheme is useful for all categories of income earners, especially those who are paying income tax. They stand to benefit more than the others. For instance: Beneficiaries of first time housing loan, paying 30 per cent income tax annually, will be able to save over Rs. 60,000.

The main aim of Pradhanamanthri Awaz Yogana is to see that everyone owns a house by 2022. That is why the Centre is offering subsidy on interests. But the scheme applies only to those who are availing housing loan for the first time. Those who already have a house in their name or in the name of their family members, cannot avail this offer. Family members include, husband, wife and unmarried children. The Centre has made National Housing Bank (NHB), Housing and Urban Development Corporation (HUDCO) and nodal agencies the responsibility of implementing the scheme. Even villagers, who have availed Rs. 2 lakh loan for building own house or extending an existing house, can avail 3 per cent subsidy on interest, under the scheme.