A PMAY (Pradhan Mantri Awas Yojana) subsidised home loan and a normal home loan both help you buy or build a house. But they differ significantly in cost, eligibility, subsidy mechanics, and savings impact. Here is PMAY Subsidy vs Normal Home Loan:
| PMAY Subsidy Home Loan | Normal Home Loan |
|---|---|
A PMAY-linked home loan includes a government subsidy on the interest component through the Credit Linked Subsidy Scheme (CLSS) or Interest Subsidy Scheme (ISS). |
A normal home loan has an interest rate set by the bank or lender based on your credit profile and market rates. |
Reduce the total interest outgo. |
A normal home loan does not offer such savings. |
This subsidy reduces the effective interest rate you pay and hence lowers your EMI or total interest cost over time. |
You pay the full interest cost over the loan tenure with no government support. |
PMAY is available only to first-time homebuyers. You and your family must not own a pucca house anywhere in India. Also, your household income must fall within EWS, LIG, or MIG categories. |
Normal home loans are broadly available to almost any qualified borrower based on income, credit score, and repayment capacity. |
Under PMAY, only a portion of the loan qualifies for subsidy (e.g., up to Rs 6 to 12 lakh depending on income category). |
A normal home loan does not include any such capped subsidized portion. |
With a PMAY subsidy, your total cost of borrowing is lower because a portion of the interest is subsidised by the government and credited to your loan account. It reduces EMIs and the interest burden. But, in a normal loan, you bear the entire interest cost, which usually results in higher EMIs and total repayment over the loan term. Hope you found the differences helpful.
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What is the Difference between PMAY Subsidy and Normal Home Loan?
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2026-02-08T19:43:42+00:00 2026-02-08T19:43:45+00:00Comment
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