PMAY-U 2.0 home loan subsidy: amount, eligibility and how to apply
Last verified: . Author: Priya Sharma. Reviewed by: Rajesh Mehta.
Short answer: The current PMAY-U 2.0 interest subsidy is up to ₹1.80 lakh, paid in five yearly instalments: 4% on the first ₹8 lakh of a home loan up to ₹25 lakh, for houses up to ₹35 lakh and household income up to ₹9 lakh. The old ₹2.67 lakh CLSS subsidy closed in 2022.
MoneyKarma (MyMoneyKarma Infomatics India Private Limited) is a home loan comparison and distribution platform, not a lender; the bank or housing finance company you choose sanctions the loan and sets your final rate.
What is the PMAY-U 2.0 interest subsidy?
Pradhan Mantri Awas Yojana - Urban 2.0 (PMAY-U 2.0) is the Ministry of Housing and Urban Affairs' "Housing for All" mission, in effect from 1 September 2024, to help 1 crore additional urban families build, buy or rent a house over five years (PIB, 24 Jul 2025). Its Interest Subsidy Scheme (ISS) vertical pays a subsidy on home loans taken from banks and housing finance companies (called primary lending institutions, PLIs).
Who is eligible for the PMAY-U 2.0 subsidy?
| Parameter | PMAY-U 2.0 Interest Subsidy Scheme (EWS, LIG, MIG) |
|---|---|
| Annual household income | Up to ₹9 lakh (EWS up to ₹3 lakh, LIG ₹3 lakh to ₹6 lakh, MIG ₹6 lakh to ₹9 lakh) |
| Interest subsidy | 4.0% a year on the first ₹8 lakh of the loan, for a tenure up to 12 years |
| Maximum home loan eligible | ₹25 lakh |
| Maximum house value | ₹35 lakh |
| Maximum carpet area | 120 sq m |
| Maximum subsidy, actual release | ₹1.80 lakh |
| Maximum subsidy, NPV | ₹1.50 lakh (discounted at 8.5%) |
| Loan tenure needed | More than five years |
| Loan date | Sanctioned and disbursed on or after 1 September 2024 |
| How it is paid | 5 equal yearly instalments into the loan account, while the loan is active and more than 50% of principal is outstanding |
Source: PMAY-U 2.0 Operational Guidelines, paras 3.3 and 5.4, PIB, 24 Jul 2025.
Other conditions from the guidelines:
- No pucca house. Your family must not own a pucca (all-weather) house in any part of India, in your name or any family member's name.
- Family means husband, wife, unmarried sons and unmarried daughters.
- Income proof: a self-certificate or affidavit.
- Aadhaar: lenders link beneficiaries to Aadhaar or an Aadhaar Virtual ID to avoid duplicate claims.
How much subsidy will I get, and how is it paid?
The maximum actual release is ₹1.80 lakh. The subsidy is 4% a year on the first ₹8 lakh of the loan for up to 12 years, which the guidelines value at ₹1.50 lakh in present value (NPV at 8.5%). It is released in five yearly instalments through the lender into your loan account, provided the loan is active and more than half of the principal is still outstanding. The lender credits it against your principal, and you pay EMIs on the reduced principal (Guidelines, paras 5.4.3 and 5.4.10).
Is the old ₹2.67 lakh CLSS subsidy still available?
No. The ₹2.67 lakh figure belongs to the earlier Credit Linked Subsidy Scheme (CLSS) under PMAY-U, which closed for MIG on 31 March 2021 and for EWS and LIG on 31 March 2022. Under CLSS, ₹58,885 crore of subsidy reached 25,04,220 beneficiaries (PIB, 24 Jul 2025).
| Old CLSS (PMAY-U) | PMAY-U 2.0 ISS (current) | |
|---|---|---|
| Maximum subsidy | Up to ₹2.67 lakh per house | Up to ₹1.80 lakh (actual release) |
| Status | Closed: MIG ended 31.03.2021; EWS/LIG ended 31.03.2022 | Open for loans sanctioned and disbursed from 01.09.2024 |
| Income limit | EWS up to ₹3 lakh, LIG ₹3 lakh to ₹6 lakh, MIG-I ₹6 lakh to ₹12 lakh, MIG-II ₹12 lakh to ₹18 lakh | Up to ₹9 lakh |
How do I apply for the PMAY-U 2.0 subsidy?
- Register your demand on the unified web portal, pmay-urban.gov.in.
- Your application is forwarded to the lender (PLI) you choose, which checks your eligibility under the scheme.
- Take the home loan from a PLI that has signed an MoU with a Central Nodal Agency (CNA) for the scheme. Each PLI registers with only one CNA. The CNAs are NHB, HUDCO and SBI (PIB, 14 Nov 2024); NHB publishes the list of lenders that have signed its MoU, 229 as of 26 Sep 2025 (NHB).
- Subsidy release: after disbursement, the Ministry releases the subsidy monthly through the CNA to the PLI, and you get an SMS when it is credited.
Source: Guidelines, paras 5.4.6 to 5.4.9.
What can make me ineligible?
- The subsidy is given only once per property. A buyer of a property on which the subsidy was already claimed cannot claim it again.
- Family members taking separate loans on the same property count as one family for income and benefit.
- A balance transfer to another lender does not allow a fresh claim. If you did not claim it from the first lender, you cannot claim it after the transfer.
- A loan above ₹25 lakh, a house value above ₹35 lakh, or income above the limit as assessed by the lender, makes the loan ineligible.
- A false income declaration can lead to legal proceedings.
Source: Guidelines, para 5.4.5.
Which home loans qualify, and what rate will I pay?
Any PMAY-U 2.0 participating lender's home loan that meets the limits above. The lender's normal rate applies, and the subsidy reduces the principal. Example: Union Bank of India publishes a "Home Loan - PMAY-U 2.0" scheme at 7.15% to 9.35% p.a., by credit score, on its card w.e.f. 24.07.2026 (Union Bank retail rates PDF, verified 9 Oct 2026).
How can MoneyKarma help with PMAY?
MoneyKarma (MyMoneyKarma Infomatics India Private Limited) is a home loan comparison and distribution platform, not a lender; the bank or housing finance company you choose sanctions the loan and sets your final rate. MoneyKarma can help you compare home loans from lenders that take part in PMAY-U 2.0; most of our partner lenders participate. The government, through the CNA and the lender, decides and releases the subsidy.