PMAY Urban 2.0: Everything you need to know

Pradhan Mantri Awas Yojana (PMAY) Urban 2.0 is a renewed initiative by the Government of India after the success of Pradhan Mantri Awas Yojana (PMAY) in 2015. This new phase focuses on the government’s commitment to 'Housing for all' by 2024, focusing on technological advancements, inclusivity, and sustainability. If you're considering a housing loan to buy a home, understanding PMAY Urban 2.0 can open doors to homeownership more conveniently and affordably with lower home loan interest rates.

Let us walk you through everything you need about PMAY Urban 2.0.

What is PMAY Urban 2.0?

Making housing loans more affordable

Pradhan Mantri Awas Yojana Urban 2.0 is the second phase of the Pradhan Mantri Awas Yojana for urban housing to create affordable housing for the urban population in India. Following the positive response to the initial PMAY phase, the Union Cabinet approved PMAY Urban 2.0 on August 9, 2024. The main goal of this scheme is to construct 1 crore houses for urban poor and middle-class families over the next five years, with an investment of ₹10 lakh crore and a government subsidy of ₹2.30 lakh crore. Under this new scheme, financial assistance will be extended to one crore urban poor and middle-class families through States, Union Territories (UTs), and Primary Lending Institutions (PLIs) to construct, purchase or rent affordable homes in urban areas.

Objectives of PMAY Urban 2.0

The major objectives of PMAY Urban 2.0 are as follows:

• Sustainable Housing: PMAY Urban 2.0 is committed to providing affordable housing for urban residents, particularly those from EWS, LIG, and MIG backgrounds with cost-effective and environmentally sustainable practices.
• Inclusivity: The scheme ensures giving priority to women, transgenders, and other vulnerable groups like widowers and separated individuals.
• Technological Advancements: Using advanced construction technologies, PMAY Urban 2.0 provides durable housing solutions to eliminate urban challenges.

PMAY Urban 2.0 Eligibility Criteria

PMAY 2.0 eligibility criteria include the following:

• Income Criteria: Eligibility varies based on annual household income and is divided into these categories:
  • EWS (Economically Weaker Sections): Annual income up to ₹3 lakh.
  • LIG (Low Income Group): Annual income between ₹3 lakh and ₹6 lakh.
  • MIG I and II (Middle-Income Groups): Annual income between ₹6 lakh and ₹9 lakh.
• Property Ownership Requirements: Applicants must not own a pucca house in their name or the name of any family member.
• Beneficiary Definition: A family consisting of a husband, wife, and unmarried children is defined as a single beneficiary.
• Location: The property should be in a statutory town as per Census 2011 or subsequent government notifications.
• Interest Subsidy: Eligible applicants receive an interest subsidy under the Credit Linked Subsidy Scheme (CLSS), reducing the effective home loan rate based on income group.

How to apply for PMAY 2.0

To apply for PMAY Urban 2.0 involves the following steps:

1. Pradhan Mantri Awas Yojana Apply Online: To get started, visit the official website, and select the "PMAY Apply Online" option to fill out the application form with the necessary documents.
2. Submit Documents: Provide necessary documents, including identity proof, income proof, and property-related documents.
3. Loan Approval: If eligible, you’ll receive confirmation of your subsidy under the CLSS.

Pro Tip: Before applying for a housing loan under PMAY Urban 2.0, use a home loan calculator, such as the IFL Home Finance EMI Calculator. This will help you estimate your loan amount and EMI, allowing you to plan your finances effectively.

Wrapping up

PMAY Urban 2.0 is an excellent initiative to bridge India’s urban housing gap. By extending financial support to diverse income groups and promoting inclusive housing, the scheme offers a valuable pathway to homeownership. With the support of IIFL Home Finance, affordable housing is now within reach. Calculate your potential monthly payments easily by using Home Loan EMI Calculator and start your journey toward your dream home with IIFL Home Finance today.