Avail the benefits of the Pradhan Mantri Awaz Yojana

In a move to ensure that more and more people can fulfil their life-long dreams of owning a home, the Prime Minister of our country announced the Pradhan Mantri Awas Yojana, in the beginning of this year. This scheme is specially designed for the lower and middle income groups. This is an interest subsidy scheme that has been named as 'Credit Linked Subsidy Scheme for Middle Income Groups - CLSS (MIG)'. As per this new subsidy, middle-income groups with incomes in the eligible range will get a subsidy on their interest rate of three to four percent.
This scheme will ensure that more and more people are eligible for home loans and can fulfil their wishes of owning their own homes. Here’s what you need to know about this CLSS scheme and eligibility.

1. People whose incomes fall in the range of 6 lacs to 18 lacs are eligible for this subsidy under the CLSS.
2. People whose housing loans were approved and those whose home loan application was in review since 1^st January 2017 are eligible for this subsidy.
3. Peoples who have an annual income of 12 lacs are eligible for a subsidy of four percent on their home loan of up to 9 lacs. People who have an annual income of 18 lacs are eligible for a subsidy of three percent on a home loan of 12 lacs according to the Prime Ministers’ address on the eve of New Year.

Here are the income slabs for the CLSS eligibity under the Pradhan Mantri Awas Yojana.

1. People with an annual income of Rs.6 lacs and below can avail of loan of Rs.6 lacs at an interest of 6.5% for tenure of 20 years.
2. People with an annual income of Rs.12 lacs and below can avail of loan of Rs.9 lacs at an interest of 4% for tenure of 20 years.
3. People with an annual income of Rs.18lacs and below can avail of loan of Rs.12 lacs at an interest of 3% for tenure of 20 years.

Here’s how this scheme will affect home loan interest rates.

1. The interest subsidy of four per cent under CLSS (MIG) will bring down EMIs of borrowers by Rs. 2,062 per month and Rs. 2,019 per month on a housing loan of Rs 9 lakh and Rs. 12 lakh respectively.
2. The total interest subsidy accrued on these loan amounts will be paid to the borrowers up front in one go. This in turn will reduce the burden of EMI on the user.
3. The tenure of these loans has been specified as 20 years or as preferred by the borrower, whichever is lower.

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Five Essential Things to do When you Take Loan Against Property

It’s an age old, time test practice to take out a loan against property. Property is said to be the best investment and people have often use their own homes as guarantees or as a mortgage.  Loan against property is preferred by many because this way you can get a higher loan amount with the benefit of lower EMI. Loan against property interest rates are lower than those of personal interest rates. You can also get a longer tenure on your loan against property, than you can get on a personal loan.

Recently, Crisil said in a note that the amount of loans taken against property is set to double to Rs.5 trillion by 2019 and it is expected that the number will grow by 22% annually in the next four years. There are also emerging signs of a build-up in risk as competition intensifies, Crisil noted.

Loan against property has a lot of benefits and for that many people choose to opt for it, so if you’re considering opting for a mortgage loan here are some things you must keep in mind.

1.   Always opt for a short tenure: Loan against property gets you a long tenure of almost 15 years or more to pay back. This one of the benefits of this type of mortgage loan but it also means that you pay more EMIs thereby paying back much more than you owe.  So always opt for short tenure for your loan against property.

2.   Always insure large loans: When you take out a large loan like a loan against property, it’s always advisable to buy insurance so that in case of any unfortunate circumstances at least your family is don’t have to face the burden of loan repayment. Banks offer term insurance along with large loans so that they at least cover the loan amount in case something was to happen to you.

3.   Read and understand: All loans come with a lot of terms and conditions. Read all the documents attached to your loan agreement carefully and sign them only on understanding them thoroughly.

4.  Replace large loans: If you have too many high cost loans you can replace them with loan against property. Loan against property can be used to consolidate all your outstanding loans. It is a good idea to close your costly loans at the earliest.

5.   Make all payments on time: Being late with your EMIs can affect your credit score adversely. Make sure you pay all your EMIs in time to maintain a sound credit score.

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