How Does The Pmay Calculator Function?

By Author: Kaivalya Borde
Total Articles: 5

India's Prime Minister Narendra Modi who introduced the concept of PMAY in 2015, provides affordable housing and renovation solutions for the middle and lower-middle class segment people in the society. A person can construct a new house or renovate an old one with the help of the subsidised rate of interest offered under PMAY.

If you are thinking of PMAY scheme application, you should know about the interest rate and the kind of EMIs that you would need to pay in case of a home loan. Online PMAY calculators can help you figure out the exact amount of interest you would be charged under the scheme. Here is a look at all the aspects that the PMAY calculator considers before making the calculations:

1. Annual household income
The annual income of your family is the first thing that you need to enter into the calculator. It will determine the amount of subsidy you are liable to receive.

2. Home loan Amount
The interest charged on the borrowed amount depends on how much you borrow. If the borrowed sum is low, the interest cost will be low. Therefore, strike a balance between the interest rate and the loan amount, so that you don’t face any hiccups while paying it back.

3. The base interest rate
The base interest rate signifies the rate of interest charged - excluding the subsidy - offered under Pradhan Mantri Awas Yoajana scheme. You need to enter the base interest so that the effective interest rate can be calculated on the same. The lower the base rate, the lower the interest rate.

4. Tenure of the loan
For any loan, the mandate plays an important part in deciding the EMIs and the interest. The same applies to loans taken under the PMAY scheme. For longer duration, the EMIs will be much higher in comparison.

However, keep in mind that you can avail a loan under the PMAY scheme only if you do not own a pucca house and have not borrowed money under any other government housing scheme in the past.