Know How to Complete your Dream of Owning a House Using PMAY

It is the dream of everyone to have their own home. But not everyone is able to achieve it. It is because the cost of investing in a home is not under the budget of all. 

But if you still don’t have a pucca home in India, you can now fulfil your wish today. 

All that you have to do is – apply for a home loan and enjoy an interest subsidy under PMAY. 

PMAY stands for the Pradhan Mantri Awas Yojana. It was launched by PM Narendra Modi in 2015 to help the poor population of India to have their own home. 

But to do that, you will need to meet the PMAY eligibility criteria. 

Read on and know more!

Meet the PMAY eligibility criteria and fulfil your wish of owning a home 

• A Pradhan Mantri Awas Yojana applicant or any other member of the beneficiary family must not own any pucca home anywhere across India. 

• A beneficiary family comprises a husband, wife, unmarried sons and unmarried daughters. 

• You or the annual income of the beneficiary family must be up to Rs.18 lakh. The annual income of your spouse can also be included. 

• It is not applicable for a PMAY applicant to avail of the benefits of this housing scheme on an already built home. 

• You must not have taken any assistance from Central or State Governments under any previously launched schemes. 

• Senior citizens and differently-abled citizens are given preferences in the allotment of the ground floor. 

• If you are married, both together in joint ownership or either of the spouses can avail of a single subsidy. 

• The construction/extension for which the home loan under the PMAY is availed must be completed within 36 months from the first disbursement of the amount. 

If you can meet these PMAY eligibility criteria, you can easily fulfil your wish of having your own pucca home and paying the reduced home loan EMIs.  

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Top 6 factors that can affect home loan interest rates

When it comes to applying for a home loan, you need to pay interest rate charges. A longer tenor may lead to the payment of higher home loan interest charges. 

Many people do not consider aspects that can affect their housing loan interest rate charges. 

On that note, let’s check out a few factors that can affect your home loan interest rate!

1. Credit score

Credit score plays an important role when it comes to your finally offered housing loan interest rates. The higher it is, the lower is your home loan interest rate. Lenders reward you because you have paid your outstanding on time. 

2. Interest rate types 

Your home loan comes with fixed and floating types of rates. Floating rates are relatively lower than fixed ones. Hence, the type of your home loan also affects your housing loan interest rates. 

3. Property location

Home loan interest rate varies as per the location of your property. If it is centrally located, lenders will offer a lower rate of interest. It is because they will find it easier to liquidate your property in case of defaults. 

4. Loan tenor 

A longer tenor means paying lower home loan EMI but more housing loan interest rate charges, and vice versa. 

5. Your loan amount 

The higher is your home loan amount; the more will be your payable housing loan interest. 

6. Your income stability 

If you are employed with an MNC, Public or a Private Limited Company for at least 3 years, you may enjoy a lower home loan interest rate. Hence, you should ensure to have consistent income stability. If you are earning without a break, the offered housing loan interest rate is lower. 

These essential aspects may affect your home loan interest rate, and you must consider them when you have housing finance to apply.     

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Steps to check your name in PMAY List 2021

The Pradhan Mantri Awas Yojana is a beneficial scheme initiated by the Indian Government. It allows intending homebuyers to avail CLSS home loans and other benefits. 

However, borrowers must note that they will receive an application number after applying successfully. This registration number is needed while checking the PMAY list. 

Steps to check PMAY list

Eligible borrowers can follow the steps below to check their names on this list. 

For PMAY – Gramin 

Step 1- Visit the official website of PMAY - G

Step 2- Provide the registration number appropriately and click on “Submit”

After this process, all the essential details will appear if your name displays on the PMAY-G list.

If borrowers fall under urban category, follow the steps below:

For PMAY – Urban 

Step 1- Applicants should visit the official website of PMAY

Step 2- A “search beneficiary” menu will display on the screen. Then click on “search by name.”

Step 3- Input first three characters of borrower’s name

Step 4- Select on “show” button, and PMAY list will display on the screen

From this list, beneficiaries will get to know if their name is on the list or not. Every year after the submission of application, applicants are evaluated, and the new list is published. 

Borrowers must know that PMAY was formerly known as Indira Gandhi Awas Yojana (IAY). The IAY 2021 list is already published. After checking their names on this list, individuals can apply for a home loan under this scheme extended by HFCs at affordable rates and flexible terms.

Please note that it is mandatory for beneficiaries to have their names on the PMAY list to qualify for a home loan under this scheme. 

Hence, borrowers can avail the benefits under CLSS when they are chosen as beneficiaries under PMAY housing schemes in India.

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Know the Eligibility Criteria before Availing Home Loan in 2021

A home is where the heart is. Everyone dreams of having their own home. Many people apply for a home loan to fund their housing aspirations. 

But not everyone is eligible enough to get home loan approval. It is because one needs to abide by the home loan eligibility criteria before they avail home loans. 

On that note, let’s know the standard home loan eligibility criteria in this post before you avail home loans in 2021. Read on!  

Standard home loan eligibility criteria 2021 at a glance 

1. You need to be aged between 23 and 62 years. 

2. You need to be employed with an MNC, Public or a Private Limited Company for a period of at least 3 years. 

3. Your CIBIL score should be 750 or more. 

4. KYC documents. 

5. Address and identity proofs. 

6. Income proofs – Salary slips or Form 16. 

7. Last 6 months’ bank account statements. 

These are standard home loan eligibility criteria. It may vary from lender to lender. Hence, the best thing before you avail home loan is to land on your lender platform and know about the housing loan eligibility criteria. 

If you want to know about your exact home loan eligible amount, you can use the home loan eligibility calculator. 

Once you enter your date of birth, city of residence, monthly Salary and income, monthly EMIs, obligations and more, the eligibility calculator will showcase the amount. 

Once you enter these aspects and hit the ‘Apply Now’ button, the home loan eligibility calculator will showcase the precise housing loan EMI amount. 

The home loan eligibility steps discussed could vary from lender to lender. Hence, you need to use the home loan eligibility amount on your preferred lender’s site. 

If you have a CIBIL score of 750 or more and work for a renowned company for at least 3 years, you can get the loan approval.

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Top Factors Pushing Housing Loan Market in India

In these challenging times of global economic crisis where businesses and markets have seen a drastic downward phase due to the rapid arrival of the COVID-19 virus on the horizon, it has significantly harmed the Indian real estate sector that was already affected by issues such as cash constraints, regulatory and procedural reforms. However, given the current situation, it is reassuring to see that experts believe the house loan industry in India would grow at a CAGR of roughly 22%.

The main forces driving the housing loan sector in India are the salaried/business class, cheap home loan interest rates, enticing developer schemes, monetary measures, government policies, regulatory backing and shortage of housing in India.

1. Salaried and Business Class- This section has realised the importance of residential rental payments equivalent to the EMIs that they will be required to pay for their properties. As a result of the circumstance, more people purchase residential spaces using home loans rather than renting.

2. Lower Home Loan Interest Rates- They are the key drivers of the home loan market. India continues to have one of the lowest home loan interest rates in the world. It currently has the lowest home loan interest rate among emerging countries. Indians are investing in real estate due to the decline in interest rates offered on savings and FDs.

3. Enticing Developer Schemes- Such schemes are another factor that encourages buyers to take home loans with the availability of enticing building incentives. It includes late EMI payments and programs depending on construction.

4. Monetary Measures- They are yet another factor pushing the market. The Reserve Bank’s economic policies are propelling the Indian home loan industry. The country has already seen higher-ever repo and reverses repo rate reductions to provide effective relief during COVID-19.

5. Multiple Government Policies- Policies like the Pradhan Mantri Awas Yojana (PMAY) is devoted to its objective of “Housing for All”, under which the Credit Linked Subsidy Scheme (CLSS) for the Middle-Income Group (MIG) has been extended until March 2021 as a result of this.

With this knowledge of the various factors pushing the home loan market in India, select the best institution offering the most economical financial instrument for loan purchase. Being aware of this information will help in making an informed decision, enabling the loan applicant to find the most suitable Home Loan option.

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Here Are 4 Things to Consider When Applying for a Housing Loan

If this is your first home loan, you may have many questions, and there's a good possibility you'll overlook certain important considerations. We've done the legwork for you and compiled a list of everything you need to know before applying for a housing loan in India- 

1. The eligibility criteria- For home loans, different lending organisations have different eligibility standards. The age brackets for loan approval and the income requirements are the most important factors to consider when availing housing loan. This is because both are inextricably linked to a person's earning potential and ability to make timely payments.

2. Credit score- Borrowers with a high credit score may qualify for a cheaper interest rate on home loans from some banks. Your credit history can assist you in obtaining a better home loan deal from a bank. Most banks and other lenders regard a credit score of 750 and above to be a good credit score as a rule of thumb.

3. Your budget, down payment and EMI- Define your home-buying budget, including how much money you can put down as a down payment and how much of a mortgage you'll need. Next, determine the EMI range that you are comfortable with, as this will aid in determining the loan's term. Finally, you can use online home loan EMI calculators to experiment with different possibilities.

4. Documents required- Lenders will also want you to produce paperwork demonstrating your eligibility. Again, the necessary documents for a home loan may vary by lender, but the following are the most common:

• KYC documents like Aadhaar card, PAN card, election card, and others

•  Address proof like utility bills

•  Identity proof like driving license, election card, and others 

•  Passport size photograph

•  Income proof like Form 16 or salary slips for the salaried and last 6 months’ bank account and financial statements for the self-employed

• Business proof for the self-employed

With trusted Indian Companies offering housing loans avail, the Mortgage Loan at minimal documentation procedure and flexible repayment tenure. Use the Home Loan EMI calculator to estimate your monthly outflows and improve financial management, along with taking advantage of various housing schemes in India. To qualify, simply meet the easy home loan eligibility criteria and submit the documentation required to process the loan and await loan approval.

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Lesser-known Pointers That Can Affect Their Home Loan Rates

If a family wishes to buy a house with the help of home loans in India, they may do so and move into the home of their dreams. However, the option comes with house loan interest, which the borrower must pay in addition to the EMI amount during the loan term. It means that their home loan EMI has a long-term impact on their income and expenses. They might get the lowest home loan interest rate if their CIBIL score is higher. They can pay lower EMIs and better manage their spending if they get the best home loan interest rate. When it comes to home loan applications in India, the CIBIL score is one of the most crucial indicators that lenders assess. For the best home loan interest rate, a CIBIL score of 750 or more is suggested. Borrowers may improve their CIBIL score by repaying their loan EMIs and other bills on time. 

The following elements that lenders may consider when determining a borrower’s interest rate are the location and value of the residence. For example, the value of a property may increase if it is located in an area with growing infrastructure and facilities. Additionally, a property’s value may be higher if it is close to an airport, a train station, or a bus stop. Therefore, the approved house financing amount may be higher in this scenario due to the lowest housing loan interest rate.

If borrowers use their credit cards for several transactions and make timely payments, their credit score may arise. This can help them get the highest interest rate on their home loan. However, if they use a credit card even if they pay the minimum due on time, the interest rate on their home loan would be higher. Therefore, they should spend more than 40% of their credit limit if they have any loans to apply for and desire a lower rate.

Compare all available home loan offers on a third-party website and choose the one that best meets finance needs and payments capacity. If the applicants follow the advice mentioned above, they should get the best home loan interest rate and pay lower EMIs. Choose from numerous Housing finance companies which have low-interest rates, a 30-year tenor, a high-value sanction, and the option to transfer home loan balances. Simply meet the primary home loan eligibility requirements, submit the required paperwork, and wait for the loan to be authorised.

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Top Factors that Can Increase Their Home Loan Eligibility

Borrowers need to meet certain eligibility criteria for getting housing loan from banks and financial organisations. The eligibility criteria set by banks and Housing Finance Companies are too high to reduce the number of non-functioning assets of the financial organisations. These eligibility criteria include a good credit score, work experience, the person’s income, previous loans if any, citizenship, and much more.

 In addition, various documents need to be submitted by them to the loan provider to prove their eligibility. These include KYC documents, Income proofs, passport size photographs, and proof of the existence of business from the last five years (in the case of self-employed individuals), account statements, and much more. Loan is not granted to the people who cannot prove their eligibility.

Various factors help in increasing the home loan eligibility, which includes the following:

• Adding a co-applicant, in this case, if a person is not eligible as per the financial organisation’s criteria, they can add a co-applicant such as a family member to increase their chances. 

• Maintaining a credit score above 750, this includes paying regular credit card and debts. If a person has a credit score of around 800, companies tend to provide them loans easily. 

• Choose a longer tenure, A borrower who chooses a longer term for repayment has more chances of securing a loan than the person who prefers a smaller tenure. 

• Declare their additional income sources. A person with more income sources gets a loan easily as it shows a high repayment capacity.

If a person wants to increase their chances of meeting the home loan eligibility criteria, they should fulfill all the above criteria. 

With these housing loan facts in hand, the borrower will be able to spot an advantageous deal. A great home loan will include a low-interest rate, a tenor of up to 30 years, a high-value sanction, and a Home Loan Balance Transfer facility. To qualify, simply meet the easy home loan eligibility criteria, and submit the minimal documentation required to process the loan and await loan approval.

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Less Known Pointers that Can Affect your Home Loan Rates

A home loan is a secured option that comes with a longer tenor. Opting for a longer tenor may reduce your home loan EMIs. 

It may help you to manage other outlays in the month easily. But, you also have to deal with a higher home loan interest rate. 

But other than a longer tenor, many less-known factors also affect the interest rate of home loan in India. 

Let’s know more in this quick post so that you can avail yourself of the lowest home loan interest rates in India!

1. The location and value of your new home 

If your home that you want to buy using a home loan is located in a well-known place with basic amenities, you may enjoy the lowest home loan interest rates. It is because your lender will find it liquidating your property easier if you default. Also, the value of your property determines the applicable home loan interest rates. 

2. Your credit utilization 

If you have a credit card or avail yourself of another credit line and used a large part of it, you may not get the lowest home loan interest rates. It is because your lender may consider you to be depending on your credit limits to manage expenses. Hence, while applying for a home loan, ensure to lower your credit utilization. 

3. Your debt to income ratio 

If you have already many debts on your head, a large part of your income may go towards your EMIs. In this case, your income may not have room to make way for another loan. Even if a lender approves your home loan application, it may be at a higher rate. 

You are now aware of elements that most borrowers don’t consider while applying for housing finance. You should consider them and work on each of them to enjoy the lowest home loan interest rates. 

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Know the Facts about PM Awas Yojana and its Subsidy

The Pradhan Mantri Awas Yojana (PMAY) is a housing scheme of the Central Government of India. 

Under this PMAY housing scheme, there is a provision to build affordable houses all over India. They are to be constructed using eco-friendly and sustainable technologies. 

Besides this, the Pradhan Mantri Awas Yojana also offers an interest subsidy on home loans. 

Under this, it is possible to enjoy a home loan subsidy of up to Rs. 2.67 lakh and 6.5%. 

The home loan subsidy is awarded across income groups of applicants whose income ranges between Rs.3 lakh and Rs.18 lakh annually. 

If you want to know more about Pradhan Mantri Awas Yojana and its subsidy, you should go through this post!

Vital Pradhan Mantri Awas Yojana facts at a glance 

1. If you want to book your first-ever pucca home, you can avail of the home loan subsidy on the interest rate and enjoy savings. The home loan interest rate subsidy can also be availed as per your income groups. Income groups are Economically Weaker Section (EWS), Lower Income Group (LIG), and Middle Income Group 1 and 2 (MIG 1 and MIG 2). 

2. A women applicant is given priority in the allotment of ground floors. It is done while allotting the homes. Differently-abled citizens are also given preferences while allotting ground floors for homes. 

3. The home loan interest subsidy is given up to 6.5% to the tune of Rs.2.67 lakh. 

4. The usage of eco-friendly and sustainable construction materials is permitted in the construction of affordable homes. 

5. The Government seeks to construct about 2 crore affordable homes in key urban areas for eligible customers. 

6. The focus of the Government is to uplift the standard of living of people in areas where low-cost homes are being built. 

If you wish to avail the PMAY benefits and enjoy interest subsidies, you can check your eligibility and get started. 

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