To achieve ‘Housing for All’ in India, the central government extended the Pradhan Mantri Awas Yojana (PMAY). This credit-linked subsidy scheme aims to provide affordable housing for economically weaker sections of society.

While the scheme is extremely generous, you must meet the strict eligibility criteria to avail of it. Read on to find out about the several reasons why a lender may decline your home loan application under the PMAY scheme.

If you have a property pre-registered to your name

If you are a previous homeowner or have a home registered under your name or the name of your immediate family member, you aren’t eligible to claim the PMAY scheme benefits. The PMAY scheme is only available for first-time homebuyers.

You don’t fall under the desired income group

Another common reason for Pradhan Mantri Awas Yojana allotment rejection is applying under the wrong income group. As an aspiring homeowner, your home loan eligibility under the PMAY depends on whether you belong to the following income categories:

  • 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

Make sure you have selected the right income group or your application for a home loan under PMAY will be rejected.

Additional Read: Common Mistakes you Make While Applying for a Home Loan Under PMAY

You’ve availed central assistance under another housing scheme

Apart from PMAY, the Government of India provides many subsidy schemes. If you or your family members have applied for central assistance on any such scheme, you won’t be eligible for the subsidised home loan interest rates or other Pradhan Mantri Awas Yojana benefits.

If your spouse has already availed of the PMAY benefits

As a married couple, you are only eligible for a single subsidy. You cannot apply for two different subsidies under the name of both spouses. So, if either of you has availed of PMAY benefits, the lender will immediately reject your second application or even a joint application.

The desired property lies outside the scope of PMAY

The PMAY scheme only applies to the purchase or construction of a new house or the expansion of an existing property. If you try to avail of the scheme for any other purpose, such as a resale flat, your lender will decline your loan application.

Additional Read: Top 5 Reasons for Not Receiving PMAY Subsidy on Housing Loan

Summing Up

Before applying for subsidy under the Pradhan Mantri Awas Yojana, double-check to see that you are not making any of the mistakes mentioned above.

If you are also eligible for claiming the benefits from the scheme, apply with Tata Capital. Score a comfortable borrowing experience with us.

You can also plan your future instalments using our home loan EMI calculator. Input your loan amount, tenure, and interest rate to get an overview of your repayment costs. 

Check your home loan eligibility and apply today.

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