This is a user generated content for MyStory, a YourStory initiative to enable its community to contribute and have their voices heard. The views and writings here reflect that of the author and not of YourStory.

Know all about credit linked subsidy scheme(CLSS)

It is a lifelong dream of many people to know their own house. Nothing can give a person more happiness than living in a house of his dreams.

Know all about credit linked subsidy scheme(CLSS)

Saturday June 03, 2017,

4 min Read

Pradhan Mantri Awas Yojana (PMAY) was launched in June 2015 by Government of India in order to promote affordable housing for all. PMAY has been implemented so as to make housing for all an actual reality by the year 2022. The programme was initially meant to cover those people belonging to the EWS and LIG categories, but MIG category is included as well. Housing for All by 2022 is a mammoth task and the government has initiated Credit Linked Subsidy Scheme (CLSS) so that people can fulfil their dreams of owning a house.

The scheme is basically designed to provide interest concession to borrowers looking to secure a home loan from various lending institutions which credit under Pradhan Mantri Awas Yojana (PMAY). About 70 lending institutions including scheduled commercial bank, small finance banks, housing finance companies, regional rural banks have collaborated with with National Housing Bank (NHB) to provide affordable finance to the people. The concerned parties have signed an agreement so as to properly implement the scheme. The maximum loan tenure offered under the scheme is 20 years. Through this article I will be telling you about the Credit Linked Subsidy Scheme (CLSS) in detail.

Credit Linked Subsidy Scheme (CLSS) for EWS and LIG

This segment has been clearly made for Economically Weaker Sections (EWS) and Low Income Group (LIG) and will cover the urban poor with an income of ₹3 lakh and ₹6 lakh per year respectively. They will be getting a 6.50% interest subsidy on a loan of upto ₹6 lakh.The loan tenure for the same has been extended to 20 years and this is bound to create a hassle free and smooth repayment process for the common man. The beneficiary will get benefits in the form of a total interest subsidy of ₹2.30 lakh.

Credit Linked Subsidy Scheme (CLSS) for MIG

In this scheme borrowers with annual income from ₹6 lakhs-18 lakhs can avail interest subsidy on their first home under Pradhan Mantri Awas Yojana (PMAY). The main target group here is middle-income groups (MIG). The loan tenure here in this case is a maximum of 20 years. People who are earning ₹12 lakhs and ₹18 lakhs a year are eligible for interest subsidy on loans for construction/acquisition of house with the carpet area of 90 square meters and 110 square meters, respectively.

People having an annual income of 12 lakhs

The people earning the said income will get an interest subsidy of 4% on a loan amount up to ₹9 lakhs. The loan amount after ₹9 lakhs is going to be charged at the normal interest rate.

People having an annual income of 18 lakhs

The people earning the said income will get an interest subsidy of 3% on a loan amount up to ₹12 lakhs. The loan amount after ₹12 lakhs is going to be charged at the normal interest rate.

Important facts which should be brought to your notice have been given below-

This scheme is only applicable when you take a home loan to buy or construct a house.

The beneficiary family should consist of husband, wife and unmarried children. An earning member of the family, whether married or unmarried can be seen as a separate household.

The beneficiary is only eligible if the he/she doesn't own a ‘pucca’ house either in his/her name or in the name of any member of his/her family in any part of India

Just in case, the beneficiary family has already availed central assistance from Government of India under any housing scheme before, then they will not be able to benefit from the scheme.

All said and done Credit Linked Subsidy Scheme (CLSS) can be considered as a perfect way to uplift the poorer sections of the society by providing them subsidy on a home loan for buying a house. The best part is even the middle income group is set to benefit from this scheme.