No, a home loan balance transfer is generally not eligible for PMAY (Pradhan Mantri Awas Yojana) subsidy. PMAY benefits are meant to encourage first-time home ownership, not refinancing or shifting existing loans between lenders. Under PMAY–CLSS (Credit Linked Subsidy Scheme), if you see, the interest subsidy is available only on fresh home loans taken. It can be for:
Purchase of a new house or flat
Construction of a new residential house
Extension or improvement of an existing house (for eligible categories)
Is Home Loan Balance Transfer Eligible for PMAY Subsidy?
Not at all. When you transfer a home loan from one lender to another, such as from LIC HFL to SBI, it is treated as a refinancing or balance transfer, not a new housing loan. Since the property has already been purchased and the loan already sanctioned earlier, the government does not provide the PMAY subsidy again.
PMAY guidelines clearly state that:
Subsidy can be claimed only once per family.
The borrower must not have availed of PMAY earlier.
The loan must be a fresh housing loan, not a takeover or refinancing loan.
A balance transfer simply replaces your old lender with a new one and does not create a new housing asset. Therefore, banks and housing finance companies do not process PMAY claims on transferred loans.
If you never claimed PMAY earlier, you still cannot claim it during a balance transfer. However, you may be eligible if:
You take a fresh top-up loan from the new lender, and
The top-up amount is used exclusively for construction, extension, or improvement, and
All PMAY income, carpet area, and ownership conditions are satisfied
Even in this case, the subsidy applies only to the top-up portion, not to the transferred loan amount. I hope this helps you understand better.
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Is Home Loan Balance Transfer Eligible for PMAY?
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2025-12-30T08:06:25+00:00 2025-12-31T19:44:38+00:00Comment
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