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Pradhan Mantri Awas Yojana (PMAY) is considered to be one of the most revolutionary schemes of the Central Government. The Center had launched the Pradhan Mantri Awas Yojana 2.0 on August 9 last year. It has been brought after the resounding success of the first phase.
In this scheme, the government gives subsidy to the needy to build houses. It is a Credit-Linked Subsidy Scheme (CLSS). This reduces the cost of repaying the home loan. But, if the person availing the subsidy does not fulfill certain conditions, then the subsidy can also be withdrawn from him.
Let us know what things should be kept in mind while applying for Pradhan Mantri Awas Yojana and on fulfilling which conditions, the subsidy money may have to be returned with interest.
When can the subsidy be refunded?
The government insists that more and more people should take advantage of the Pradhan Mantri Awas Yojana. But, some people deliberately or out of compulsion make some mistakes, due to which a situation of going back to credit linked subsidy arises.
1. If the borrower is unable to repay the loan installments to the bank on time and the loan becomes a non-performing asset i.e. NPA. This means that the bank assumes that it will not get the loan amount back. In such a situation the credit-linked subsidy is withdrawn.
2. If any beneficiary has received credit subsidy. He has also started construction. But for some reason he stops the construction. In such a situation, the beneficiary will have to return the subsidy amount received under the Pradhan Mantri Awas Yojana.
3. Even if the beneficiary does not submit the house utilization certificate, the government can withdraw the subsidy amount. This certificate has to be submitted within one year to 36 months from the date of disbursement of the first installment of the loan.
Apart from this, keep these things in mind also.
Under the Pradhan Mantri Awas Yojana, a family gets only one subsidy.
In a family, along with husband and wife, there are also unmarried children.
There should not be any permanent house in the name of the applicant or his family.
He should not be receiving housing assistance from any other housing scheme.
What will happen when the subsidy ends?
Under Pradhan Mantri Awas Yojana, interest subsidy is given in advance in the loan account of the beneficiary. This means that it is deposited at the beginning of the home loan. This reduces the effective housing loan amount and EMI. After the subsidy ends, the beneficiary has to return to the original interest rate, due to which the EMI increases.
