Buying a home is a dream every person has. But sometimes, all the savings and hard work are not enough to buy the house you want. People are often unable to pay the entire price of the house upfront. This is where home loans come in. With mortgage home loans, more and more people’s dreams of owning a home are coming true. Read on to find out everything related to mortgage loans in India. [B-01] What are mortgage loans? A mortgage loan is a loan taken against a property. The borrower usually pledges their property to acquire a home loan. The loan can be used to buy a house, renovate or extend your house as well. How does a mortgage loan work? If you want to avail a mortgage home loan, you must choose a lender (bank or other financial institution). You must also meet their eligibility criteria of age, credit score etc. The loan will be offered to you with your property serving as a collateral. Therefore, mortgage loans are secured loans. You, as the borrower, sign an agreement to pay the lender in monthly instalments. There is also an interest rate involved. Some standard eligibility criteria of mortgage loans With every loan, the lender takes a certain amount of risk. Therefore, there are some set eligibility criteria that the applicants must satisfy. Most mortgage loans in India have similar eligibility criteria. 1. Regular source of income: The first thing that lenders check is the applicant’s source of income. You must have a regular and stable source of income to be eligible for mortgage loans. You can provide your IT returns of the last financial year or your salary slip as a proof of income. You can also use your current bank statement as a proof. 2. Debt-to-income ratio of more than 50%: Your debt-to-income (DTI) ratio is the percentage of your net income that goes into paying debts. This includes existing loans, credit cards and EMI purchases. A large DTI percentage indicates that you have too much debt. Thus, lenders think that you won’t be able to pay EMIs of your mortgage loan. To bring your DTI ratio down make sure to close off older debts. 3. Decent credit score: Your credit score (CIBIL score) is used to measure your potential as a borrower. The higher the credit score, the more is your chance to get approved for loans. In India, mortgage loans are usually offered to people with a credit score of 580 or above. Different aspects of mortgage loans By now you know about the basics of mortgage loans. Here are more details about the loan, EMIs, interest rates and more. Principal amount: A mortgage loan in India will usually offer up to 90% of the value of the collateral property as a house loan. The exact amount depends on your record as a lender, financial stability etc. Down payment: While taking a mortgage loan for your house, you also have to pay an amount as down payment. This is the amount that is not covered in the principal amount. It can vary from 10 to 40% depending on the mortgage loan amount. EMI: You have to pay an EMI or Equated Monthly Installment every month. This is the way in which you repay your mortgage home loan to the lender. The EMI has two components – the principal amount and the interest. The amount of monthly EMI depends on the tenure of your loan. Tenure: Tenure of your home loan is the amount of time for which the loan has been sanctioned. It can vary from 5 years to even 25 years. For women borrowers, home loan tenures can even be 30 years. Interest rate: There are two types of interest rates on mortgage loans – fixed interest rates and floating interest rates. Fixed interest rates remain the same throughout the tenure of the loan. Floating interest rates are subject to fluctuations in the market. They can either go up or down. Other charges: Home loans taken against a mortgage also levy a small processing fee and a service fee. [B-02] Looking for a housing loan? Piramal Housing Capital and Finance has a number of options – with easy approvals and quick disbursement.
There are different types of home loans available. The most common are basic home loans for buying or constructing a house. Banks and financial institutions also offer loans for home extension and renovation. Both home extension and renovation are costly processes. Therefore, these home extension and renovation loans can be very beneficial for homeowners. Let us know more about them, followed by their differences. What are home extension loans? With time, people’s requirements change. Families grow, and as a result of this, people require more rooms. Other than that, people also wish to add certain features to their houses. Some people build a balcony because their previous house lacked one. Others want to transform the excess space into a lawn, pool, or garden. Adding a floor to single or double-story houses is also a common occurrence. Although these home expansion processes are less costly than buying an entire home, they still cost a lot. Therefore, these home extension loans come to use. People wishing to extend their homes can avail of a home extension loan from a bank or financial institution. Here are the features of home extension loans. Simple eligibility criteria Great interest rates 90% to 100% of the extension value is given as the principal amount. Long repayment tenure Easy documentation What are home renovation loans? Every home needs renovation at some point. As houses age, brittle plasters affect the walls. Simultaneously, the woodwork starts to wear off, and the roof leaks. Therefore, these houses need repairing. Some people also love remodeling and renovating their houses to give them a different look. All such renovations and alterations require a lot of money. Thus, banks and financial institutions offer home renovation loans. These loans are easy to access and have simple eligibility criteria. Some features of home renovation loans in India include: Easy eligibility criteria Low interest rates Quick approval and disbursal High loan-to-value ratio What is the difference between a home extension loan and a home renovation loan? Home extension and renovation loans are useful for people who want to improve their homes. They are both easy to obtain and offer attractive interest rates. However, both have their pros and cons. Here are some differences between the two. 1. Shifting: While renovating, it is mandatory to move to a new temporary residence. This has its own expenses, and the process is hectic as well. But if you’re adding a room or a floor to your house, there is no need to move. In this respect, home extension loans are more convenient. 2. Ease of approval: Although both loans get approved fairly easily, home renovation loans have a higher approval rate. This is because they are more popular and lenders are more comfortable granting them. 3. Tenure: Home extension loans are almost similar to conventional home loans. They also have similar tenures for repayment through EMIs. They have long tenures, thus offering affordable monthly installments. Home renovation loans have comparatively shorter tenures. 4. Collateral: Home extension loans are comparable to the usual housing loans. Therefore, lenders sometimes require collateral against which they grant extension loans. Home renovation loans have no such requirements. 5. Hassle-free process: Home renovation loans require minimal documentation and can be disbursed within a few minutes. Home extension loans also require only basic documents. However, lenders make a few more inquiries when granting the latter. 6. Flexibility to spend: One of the biggest advantages of home renovation loans is that they allow you to allocate the funds wherever you want. You can use the granted loan amount to do any kind of work you wish to do. You can invest it in carpentry, plumbing, masonry or anything else. As for home extension loans, you can only spend them for a particular cause. [B-02] 7. Balance transfer facility: Loan balance transfer allows you to transfer your outstanding loan balance to another lender for lower interest rates. This helps reduce your burden of debt. It also allows you to extend your repayment tenure as well. Most home extension loans enable borrowers to transfer their loan balance. It is less likely to be available for home renovation loans.
Buying a home of one’s own is a dream every person has. But today, that dream is not limited to just men. With societal changes, women are becoming homeowners and building a home of their own. To encourage more women to go on the same path, banks and financial institutions have many benefits in place. These home loan benefits help women avail of loans without much hassle. Thus, more and more women are starting to have houses credited to their name. If you are a woman looking to buy a house, these are the home loan benefits you should know about. [B-01] 1. Lower interest rates for women: One of the biggest home loan benefits for ladies is the lower interest rates. People who have ever purchased anything on a loan will know that even a 0.01% difference in interest rates amounts to a lot of savings. In order to incentivize more women to buy their own houses, banks and financial institutions offer concessions on the rate of interest on the home loan. The concession might vary from 0.05% to 0.1%. Although this number doesn’t look as impressive, it can make a huge difference. Let us understand this with a simple example. Typically, home loans last for long periods of time. It might take even 15 to 20 years, in most cases. So let us assume that a borrower takes a home loan of Rs. 50 lakhs for 20 years. The interest rate applicable for male borrowers is 8.65%. While the interest rate offered to female borrowers is 8.6%. Therefore, the interest outflow for the male borrower is Rs. 55,28,083 and the interest outflow for the female borrower is Rs. 54,89,953. Evidently, the savings from the woman borrower’s interest outflow amounts to Rs. 38,130. 2. Women enjoy tax benefits, even as co-borrowers: All women availing a home loan are eligible for tax deductions of up to Rs. 3.5 lakh. The same tax benefits can also be availed if you apply for the loan with your spouse. If a couple applies for a home loan jointly, they can still claim the tax deductions. The maximum tax deduction allowed on principal amount is Rs. 1.5 lakh. While the maximum tax deduction allowed on the home loan repayments is Rs. 2 lakh. 3. Lower stamp duty charges for women: Stamp duty adds a significant amount to the cost of the house. To make sure that more women own property, different states lowered stamp duty charges by 1 to 2%. This can result in a woman saving up to Rs. 1.6 lakh on a property worth Rs. 80 lakh. 4. Pradhan Mantri Awas Yojana (PMAY) scheme benefits: The Pradhan Mantri Awas Yojana (PMAY) is a government initiative. The scheme is designed to help women own more houses. It helps women to get access to home loans. Widows and single working women are given preference. You can visit the official website of Piramal Finance to apply for the scheme with a simple click. 5. Large amounts of loan with simple eligibility criteria: To attract women borrowers, lenders have relaxed their eligibility criteria. Some financial institutions offer home loans to people with a credit score of 650 or less. These kinds of home loan benefits make it easy for women to buy their own houses. If you are a woman looking for the best home loan options, Piramal Finance website has a lot to offer. 6. Higher chances of loan approval: Statistics have shown women to be better borrowers than men. There are less defaulters among women and they also have higher credit scores on average. Therefore, financial organizations tend to approve loans of women more easily. 7. Flexible tenures: Among the best home loan benefits for women are the flexible repayment tenures. Women applying for home loans can choose repayment tenures lasting up to even 25 to 30 years. Such convenience gives women the confidence to build a home of their dreams. [B-02] 8. Other benefits: Lenders often have exciting offers and gifts for women availing home loans. These include vouchers, gift cards, gold coins and free holidays, among others. These additional sweet gestures are truly worthy of mention.
A business loan can be highly beneficial for businesses looking to improve their overall sales, growth, and revenue. Any business with a lack of capital or the right type of funds to support its functions chooses appropriate loans and makes the most of them. However, the problem arises when there is a certain miscalculation or a circumstance you simply cannot avoid. During such times, you may encounter a default on your business loan. A default on a business loan could sound like bad news. However, there is always a way to mitigate the risks. In this article, we will talk about the same in detail for your knowledge. [B-01] What Is A Business Loan Default? When a borrower breaks the rule regarding the determined duration of the loan agreement, you may face a business loan default. This mostly happens when the borrower fails to make the payments as decided. Hence the lender may have to take legal actions against them, which might land them in financial problems. But there can be some intelligent ways to avoid this issue if done right. We will discuss them as we read. What Happens When Default Loan Problems Arise? 1. Credit Score Drop Your credit score is what helps you obtain loans and get them approved. So, the lender reports to diverse credit agencies if you fail to pay during an installment. Since your good credit score is what helps you obtain the best business loans on time, it is prudent that you have it checked. Remember, a drop in your credit score also means that your loan can be denied. 2. ncrease in Interest Rate If the credit score drops, there is a high chance the lender will increase your interest rate. This will put you in a spot with your finances and inconvenience while trying to save every penny for your business’s future. As such, it may also take a toll on your loan repayment capabilities in need. With this, the future business loan approvals that you might want to obtain will also become somewhat full of hassles. 3. Foreclosure When a default loan problem occurs, the results can be different depending on the security or insecurity of those loans. If you have a secured loan, a foreclosure will give the lender all the rights to access all properties and assets as collateral. If the loan is unsecured, the lender may demand you provide them with a personal guarantee of all your business assets. None of these is healthy for your future loan approvals. 4. Announcing Bankruptcy If there is a default loan problem, the lender will eventually begin with the legal procedure that will help recover the loan. If there is a secured loan issue, then the lender will ask for collateral. However, in the case of unsecured loans, the lender is most likely to sue you for this issue. So, it is important to maintain caution at every step of the way. How To Avoid Default On Business Loan? 1. Remember The Date The EMI dates are essential because this is when you need to pay your business loans. That is why it is only a good practice to keep checking your phone for bank notifications that keep updating you about your EMI loans. This helps you to avoid a default on your business loan and other hassles that could come with it. In this process, if your account does not have a sufficient balance, you can at least deposit money on time to keep the cash flow consistent and leave your EMI unharmed. 2. Speak To Your Lender If there is any issue with your business loan payment, it is best to speak to a lender about it. Inform them on time so they can tell you how you can mitigate this issue or avoid your default loan problem. Do not sit back and worry about what to do next. Remember, your lender can always provide you with the right kind of assistance you need. Also, even if they fail to assist, they might help you find the right ways to mitigate the problem. 3. Debt Rescheduling The lender can be open to renegotiating the business loan if you face hindrances regarding the monthly payments. So, the lender is most likely to give you a new loan tenure along with a revised interest rate. You must follow this one to avoid your default loan problems again. [B-02] The Bottom Line If you do not know what a defaulter of loan means, do not hesitate to consult your financial expert. You could also speak to your lender regarding the same and help them explain it to you. Remember that this article is bound to help you. So, make the most of it while you can.
A business line of credit is the best option for you if you are looking for a flexible loan. Its function is the same as that of a credit card. Your business can borrow money from the line of credit whenever needed without paying interest on the entire line. The line of credit can also be used to cover all your payroll expenses and supplier fees. [B-01] There is a secured line of credit and an unsecured one as well. In the case of a secured line of credit, you have to give collateral to get your loan approved. These two types of lines of credit vary in interest rates, fees, and other requirements. However, both types require an annual renewal. You have to make sure that you have been in business for more than six months and have a good credit standing. Pros Of Business Line of Credit 1. Evens Out the Cash Flows A line of credit loan can help you even out your cash flows when your income is lower than your expenses. With the help of this credit line, you can pay your bills on time and avail the discount offered on timely payments. That will help you save a certain amount of money. Similarly, when your business is down during the busy season, you can use the money from this to increase your production, which will boost your income. 2. Only Pay for Your Needs If you opt for a regular loan, you will have to pay interest on the entire amount. This can be way above your business’s budget. However, in the case of a secured or unsecured line of credit, you have to pay interest only on the amount you have withdrawn. The balance of your line of credit will be the estimated total of all the expenses that you incur. 3. Better Opportunities With a line of credit, you have the chance to take advantage of opportunities like better marketing and advertising. They also open the doors to launching new products or opening an office in a new location. They also give you the ease of enjoying these things whenever you feel it is the right time. 4. Relationship With the Lender A line of credit requires a little bit of inquiry to know about your loan balance. This will lead you to contact the individual who helped you get the loan at the bank or other financial institution. If you build a good relationship with them, you can get a good referral when you want to take out another loan for any purpose. Cons Of Business Line of Credit 1. An Expensive Affair Even though you have to pay interest on the amount you borrow from your line of credit, it is still expensive. This is because they usually come with a high rate of interest. Sometimes the interest rate goes above 20%. Along with that, many credit lines come with hidden fees for initiation and processing. They also charge a significant amount for late repayments. 2. Application Process Is Time Consuming Applying for a business line of credit is much more burdensome than applying for a secured loan or a credit card. The documents required are: Your business bank statements Your bank statements Business tax returns Other business documents This is why it takes a lot of time to get your line of credit approved and sanctioned. 3. Leading to Temptations As good as a line of credit is for future opportunities, it is equally harmful because not every opportunity is good. If you take up business risks without evaluating them properly, you might end up using all your profit for the high-interest payments. Proper discipline is needed when you are taking out such a loan. 4. Low Limits A line of credit has a limit that is higher than a credit card but lower than that of a proper instalment loan. If the line’s limit is not enough for your business needs, taking up the line can be an entire waste of funds for you. The line will just add to your debt, leading to a downfall in your credit score and an increase in your debt-to-income ratio. [B-02] Is A Business Line of Credit Right for You? If you are looking for extra cash flow but do not have any specific purpose in mind, this is the right call for you. It will help you get through the seasonal ups and downs of businesses without any hassle. However, it is important to keep in mind that qualifying for a business line of credit is not as easy as it seems, especially for the unsecured ones. The lenders also tend to put a cap on the expenditure limit of your line of credit that you may not enjoy.
Getting preapproved for a home loan is considered to be very important in the process of buying a home. You can start off by consulting with a bank or lending institution and providing details about your home loan capital requirements. By getting a pre-approval letter from your bank, you will be able to discuss all the available loan options and budget your loan with your lender. This article discusses pre-approved home loan benefits and how to get a pre-approved home loan. [B-01] What Is a Pre-Approved Home Loan? A pre-approved home loan is a sanction provided by the lender. The bank will determine your eligibility for a home loan before granting this pre-approval. Unlike a typical home loan, a pre-approved home loan does not involve plenty of scrutiny along with legal and technical validation of the property. After verifying all of your information, the bank will assess your eligibility and license a loan with a particular interest rate. However, you will be required to submit all of your property documents along with your financial information. It is also important to remember that a pre-approved home loan does not translate to a guaranteed home loan. The lender would still have to approve your application before granting a home loan. Benefits of Pre-Approved Home Loans There are plenty of benefits that come along with pre-approved home loans. Here are 3 key benefits. 1. Negotiate With The Lender: As you gain an understanding of your eligibility and the interest rate offered directly from your lender, you would be in a better position to negotiate the interest rates and other terms. With a sanction letter in hand, negotiating becomes easier. 2. Easier And Faster Loan Process: Now that your loan application has already been verified and pre-approved, you can speed up the process of your home loan application. The only processes that have to be completed for disbursal include the income document certification and the legal procedures. 3. Better Financial Planning: When you get your home loan pre-approved, you gain a deep understanding of your financial eligibility, repayment requirements, and others. This insight can help you plan your finances better and stay on track with your loan repayment. Eligibility Criteria The eligibility criteria for a pre-approved home loan may vary depending on the bank you are availing the home loan from. However, there are certain common criteria that have to be met to be eligible for a pre-approved home loan. Age: To apply for a pre-approved home loan, you should be a minimum of 21 years and a maximum of 70 years of age. Credit Score: Your credit score is a crucial criteria to apply for pre-approved home loans. It should be at least 700 or above. Employment: People from a horizon of employment can apply for pre-approved home loans. Both salaried and non-salaried individuals who are existing or non-existing customers can apply. Things To Keep In Mind While Applying For a Pre-Approved Home Loan While getting a pre-approved home loan can be extremely beneficial, here are some things that you should keep in mind. 1. Associated Fees: It is important to consider the fees that are associated such as the pre-approved home loan processing fee and others. 2. Expiry Date: Your pre-approved home loan may expire over time. Usually, the time range for your pre-approved home loan can vary between 3 and 6 months. Make sure that you check the expiry date with your lender. 3. Credit Enquiry: You may be subject to credit enquiry once you apply for a pre-approved home loan. This is a process during which your lender will check your credit score and assess your creditworthiness. 4. Rejection of Application: It is important to understand that pre-approved home loans do not guarantee the disbursal of your home loan. Your application has to be verified by your lender after the pre-approval process for your home loan amount to be disbursed. 5. Interest Rate: While you apply for a pre-approval, make sure that you discuss the interest rate with your lender. In many cases, the interest rate of the home loan may be fixed during the time of pre-approval. [B-02] Final Thoughts Pre-approved home loans can help understand your eligibility and also plan your finances in advance. While getting your home loan pre-approved can fasten the home loan application process, it is not a guarantee of disbursal. If you are looking to apply for a home loan, Piramal Finance can offer you with home loans at competitive interest rates and plenty of benefits.
Owning a home in most cases is a once-in-a-lifetime investment and a collective dream of a family. There are several factors such as income, age, repayment capability, etc. which are considered by a lender while approving the home loan Many hands make light work holds true when it comes to a joint home loan. The involvement of multiple applicants as co-borrowers eases the repayment of loans and increases the chances of getting a higher loan amount. What is A Joint Home Loan? A joint home loan is a home loan taken with a co-borrower to share the financial burden and to get better home financing options. A co-borrower also known as a co-applicant is an immediate family member or a relative with whom the joint home loan is taken. All co-applicants can claim tax benefits under a joint home loan. Unless the co-applicant is a sibling or a relative, it is not mandatory for the co-applicant to be the co-owner of the property you wish to buy. However, all the members mentioned in property documents as co-owners have to be the co-applicant for a home loan. Who can Co-apply? Before we understand who can be a co-applicant when applying for a joint home loan. It is important to be able to differentiate between a co-owner and a co-applicant. A co-owner as established by the property documents is a joint owner of the property. On the other hand, a co-applicant can be any immediate family member who has a steady income flow. When applying for a joint home loan, it is mandatory to have a co-owner as a co-applicant while vice versa is not mandatory. Benefits Of A Joint Home Loan There are several benefits associated with a joint home loan. Some of the key benefits of a joint home loan are mentioned below. Higher loan amount The more the merrier holds true when it comes to a joint home loan. There are multiple earning members as co-applicants in case of a joint home loan. A lender considers the income of both the co-applicants while deciding the loan amount to be sanctioned. The more the income, the higher would be the amount of loan sanctioned by the lender. The higher loan amount gives you the opportunity to go for that dream home that you might not have been able to afford with a regular home loan. Ease of repayment One of the primary factors considered by a lender while approving the loan is the repayment capability of the borrower. In a joint home loan, there are multiple borrowers as co-applicants for the same loan. The EMIs repayment is shared among the co-applicants which reduces the burden on each member. This could also help in paying higher EMIs, reducing the loan tenure and the interest paid to the lender. Higher EMIs and shorter loan tenure increase your chances of becoming debt-free quicker. Tax relaxations A joint home loan allows the co-applicants to claim tax benefits separately. Under Section 80C and Section 24 of the Income Tax Act, a tax benefit up to INR 1.5 lakh on the principal amount and INR 2 Lakh on the interest amount can be claimed by the co-applicants. Please note that these relaxations can not exceed the interest amount paid to the lender. Special benefits for women There are home loan benefits for women if one of the co-applicant is a woman then she can avail an additional benefit of lower interest rates offered to women by lenders. [B-02] Bottom Line A joint home loan with your trusted family member as a co-applicant makes the process of acquiring your dream home more convenient and beneficial as compared to a normal home loan. The ease of repayment, higher loan amount, and sharing of financial burden are some of the benefits you reap when you opt for a joint home loan.
Planning to buy that dream home? A home loan is the next thought that comes to one’s mind, and the obvious big question is where to take the home loan from. It is crucial to choose the right type of lender according to one’s requirements. There are two options where one can borrow from: Banks – under Reserve Bank of India (RBI) regulations. Housing finance company (HFC) – specialized non-banking housing finance companies regulated by the National Housing Bank (NHB). Though both the bank and HFC home loans seem similar, they differ significantly due to different regulatory environments and fund sources. They both have their pros and cons. Thus, the borrower must make an informed choice based on these pros and cons and other vital factors such as interest rates, ease of borrowing, eligibility criteria, etc. [B-01] Home loan from Bank- Pros and Cons. The Advantages/Pros: Banks pass on the interest rate changes faster to borrowers as they follow the marginal cost of funds-based lending rate (MCLR) model of RBI. Banks have an overdraft facility that enables savings on the interest payments made by the borrowers. Banks prefer high credit scores and offer attractive interest rates on the loans. The Disadvantages/ Cons Banks follow a complex and stringent process of documentation. Loan Sanction takes a lot of time and is tedious. Loans are usually not available for people with low credit scores, i.e., below 750. The loan amount sanctioned does not include stamp duty and registration costs while approving the home loan on a property value. Home loan from Housing Finance Company (HFC) – Pros and Cons. The Advantages/Pros: While sanctioning a home loan, an HFC includes stamp duty and registration costs as part of the property’s market valuation – thus the borrower receives a higher loan amount. HFCs are comparatively less stringent about credit scores. Their higher interest rates make them flexible towards loan applicants having lower credit scores, even with a credit score of less than 750. HFC’s credit scoring model allows borrowers from the low income or informal segments, usually without any credit history, to take home loans. Documentation is hassle-free, and turnaround time is fast. The Disadvantages/ Cons Interest rates on home loans can be high. HFC’s may be slower in passing interest rate cuts to the borrowers as their lending rates are based against the benchmark prime lending rate (BPLR). HFCs do not offer an overdraft facility. A comparison between Bank Home Loan vs. HFC Home Loan CriteriaBank home loanHFC home loanRegulated byRBI-Reserve Bank Of IndiaNational Housing Bank (NHB)DocumentationStringentNational Housing Bank (NHB)Rate of InterestComparatively less than HFCComparatively higher than BanksFacility of OverdraftAvailableNot availableBenefits in interest ratesPassed faster as compared to HFCPassed slower as compared to banksLoans for lower-income group/ Informal segmentsNot availableAvailable [B-02] How to Make a Choice The borrower should carefully evaluate the actual loan requirements to make the right decision while selecting a lender, and also the following criteria are worth considering: Banks don’t include stamp duty and registration costs while sanctioning home loans on a property value, but HFC does. HFCs are flexible in approving home loan applications, offering variable loan periods, loans to the lower-income group, competitive interest rates and hassle-free documentation with fast loan disbursement. An HFC like Piramal Finance works well in doing this.
What is PMAY Pradhan Mantri Awas Yojana, PMAY for short, was introduced with the ambition of ensuring ‘housing for all’. With a focus on urban and semi-urban areas, the relevant scheme is termed PMAY-U (urban). The eligible target audience for PMAY-U is first time home buyers from the Economically Weaker Sections (EWS) or Lower / Middle Income Groups (LIG and MIG). With a similar concept and vision, PMAY-G (grameen) was introduced in rural areas. The main difference is that the eligible beneficiaries are to be chosen by local governing bodies based on predetermined criteria. The rules are stringent, and their enforcement strict to avoid any misuse or misappropriation of this scheme. Aadhar card entries are maintained in records for tracking purposes. However, even after feeling they are eligible, several people have reported getting their allotment applications rejected. Let us examine some of the most common reasons why this can happen. [B-01] Not Being Part of the Eligible Income Groups As mentioned earlier, the concept of PMAY’s ‘housing for all’ vision is focused towards people with lesser financial resources available to them and ensuring their standard of living is improved. For this purpose, certain categories have been defined, and people need to choose the right one depending on which category they fall under. Proofs are to be proffered for the purpose of verification of annual household income. If the wrong category is chosen, then the chances are high that your application will be rejected. Economically Weaker Sections (EWS) – Households with annual income less than Rs. 3 lakhs Low-Income Groups (LIG) – Households with annual income between Rs. 3 lakhs to Rs. 6 lakhs Middle Income Group-I (MIG-I) – Households with annual income between Rs. 6 lakhs to Rs. 12 lakhs Middle Income Group-II (MIG-II) – Households with annual income between Rs. 12 lakhs to Rs 18 lakhs Property Already Registered In Your or Spouse’s Name Another important condition, for availing the benefits of Pradhan Mantri Awas Yojana, as mentioned in the introduction section is the fact that PMAY is targeted towards first time home buyers. Hence, their motto – housing for all. If you are already a homeowner or have a home registered under your name or the name of your immediate family member, you will not be eligible to claim the benefits offered by the PMAY scheme. Providing false or incorrect information in this context is sure to get your application rejected.Do note that this condition also extends in the case of spousal eligibility. There is only a single subsidy benefit that can be availed for a married couple under PMAY. In other words, it means that if either you or your spouse has already availed this benefit, then you are no longer eligible to claim it again. If you do try, whether as an individual or as joint applicants, it is bound to get rejected. Availed Benefit of Some Other Scheme Pradhan Mantri Awas Yojana is not the only subsidy based housing scheme offered by the Honorable Government of India. There are other central and state level based schemes that share a similar mission and vision. In case you or your immediate family members have applied for or already availed support from any such scheme, your eligibility for PMAY shall get nullified, and you will no longer be eligible for the PMAYU or PMAYG benefits, as might be the case. Type of Property Being Considered It is worth noting that the PMAY scheme is applicable for the purchase/construction of new homes or (if applicable) to the expansion of an existing eligible property. If you are applying for properties that may be of other nature, like resale or distress sale, then the application may be denied by the lending institution. There is a certain amount of discretion involved here and will need to be thoroughly checked by your chosen lender. [B-02] In Summation As you must have noticed, PMAY is a very beneficial provision to enable and encourage first time home buyers. Due to low interest rates and credit-linked subsidy, you can own your home in an instant. However, you need to be careful and transparent in the information to be provided as part of your application. Consult trustworthy financial institutions to ensure you can avail the benefits of this advantageous scheme.