PMAY-Urban 2.0 is the Centre's second urban housing mission. The Union Cabinet approved it on 9 August 2024, and the Prime Minister launched it with its guidelines on 17 September 2024. It runs for 5 years from 1 September 2024. For home buyers, the part that matters is the Interest Subsidy Scheme (ISS): a subsidy on a home loan from a bank or housing finance company, paid by the Ministry of Housing and Urban Affairs (MoHUA).
ISS replaces the old credit-linked subsidy (CLSS) of the first PMAY-Urban, but the rules are different. Don't rely on what a friend got under CLSS.
Who is eligible
Your family means husband, wife and unmarried children. The family must:
- earn an annual household income of up to ₹9 lakh:
| Category | Annual household income |
|---|---|
| EWS | up to ₹3 lakh |
| LIG | above ₹3 lakh up to ₹6 lakh |
| MIG | above ₹6 lakh up to ₹9 lakh |
- not own a pucca house anywhere in India, in any family member's name
- not have been allotted a house under any Central, State or local government housing scheme in the last 20 years
- take a home loan sanctioned and disbursed on or after 1 September 2024 to buy, re-purchase or build a house in a covered urban area
Income is shown by a self-certificate or affidavit. Lenders still assess your income for the loan itself. If two family members borrow on the same property, their incomes are added together.
The loan, house and area caps
| Parameter | Limit |
|---|---|
| Home loan | up to ₹25 lakh |
| House value | up to ₹35 lakh |
| Carpet area | up to 120 sq m |
| Subsidy rate | 4% a year on the first ₹8 lakh, for up to 12 years |
| Maximum subsidy actually released | ₹1.80 lakh |
| Maximum subsidy in present-value terms | ₹1.50 lakh (discounted at 8.5%) |
The guidelines are strict on the caps: if the family income or property value assessed by the lender for sanction is above the limit, the loan is not eligible at all. It is not a partial subsidy. For a plot plus construction, land cost plus construction cost must stay within ₹35 lakh. The full ₹1.80 lakh needs a loan tenure of more than 5 years; if your loan is below ₹8 lakh, the subsidy is worked out on the actual loan amount.
How the subsidy is paid
- It is released in 5 equal yearly instalments by direct benefit transfer into your loan account, not your savings account.
- Each instalment is deducted from your principal. You keep paying EMIs at the lender's normal rate on the reduced balance.
- An instalment is paid only if the loan is active and more than 50% of the principal is still outstanding. A large early prepayment can cost you the later instalments.
- The lender must upload your claim within 30 days of disbursement. You get an SMS when an instalment is credited.
- For an under-construction flat, the house must be geo-tagged before each instalment. For a ready flat, after the first.
The lender also cannot charge a processing fee on the eligible part of the loan. MoHUA pays the lender ₹4,000 per sanctioned application instead.
How to apply
- Register on the PMAY-U 2.0 portal (pmaymis.gov.in) under "Apply for PMAY-U 2.0", and choose the bank or housing finance company (the Primary Lending Institution, or PLI) you want the loan from. The FAQ says ISS applications must go through this portal.
- Declare your household income, that you own no pucca house in India, and that you have had no housing scheme benefit in 20 years. Note your application ID.
- Apply for the loan with that lender. Keep Aadhaar for every family member, PAN, address proof and income proof ready. Aadhaar is used to check for duplicate claims.
- After disbursement, the lender raises the claim. Track it on the portal's application status page.
Ownership. The guidelines want houses under the scheme to be in the name of the female head of the household, or jointly with her. A house can be in a man's name only if there is no adult woman in the family. Single, widowed and separated applicants can apply in their own name.
Status as of October 2026
- The mission period is 5 years from 1 September 2024. On 21 October 2026, the portal showed no closing date for ISS applications, and we found no MoHUA notice changing the ISS terms.
- Some websites quote other "deadlines" or bigger subsidy amounts. We found no official basis for them; go by the guidelines and the portal.
- Lenders join through central nodal agencies, so not every bank branch or HFC may handle ISS. Ask before you apply.
What it means in Thane, Badlapur and the MMR
The ₹35 lakh house value is the real test. The income limits are generous for many MMR families, but the house cap rules out many flats. Smaller flats in outer MMR towns such as Badlapur and Ambernath are more likely to fit than flats in Thane city. Check the full agreement value. The guidelines don't say whether parking, stamp duty or GST count towards house value, so ask the lender how they will assess it before you book.
Plan your cash. Stamp duty is generally 6% in Badlapur and 7% in Thane city, and banks don't finance it. See our guide to Maharashtra stamp duty and registration charges and the cost of buying a home in Thane and Badlapur.
Women's ownership vs the stamp duty concession. Maharashtra's 1% concession needs women-only buyers. PMAY-U 2.0 allows a wife and husband jointly. A joint purchase meets PMAY but loses the 1% concession.
Illustration (assumed figures): a ₹34 lakh ready flat with OC in Badlapur, bought jointly by a couple with household income of ₹8.5 lakh.
| Amount | |
|---|---|
| Stamp duty at 6% | ₹2,04,000 |
| Registration fee | ₹30,000 |
| Home loan (within the 80% RBI cap) | ₹25 lakh |
| ISS subsidy, if all conditions are met | up to ₹1.80 lakh, as 5 instalments of ₹36,000 |
The subsidy cuts your principal each year. It does not reduce the down payment, stamp duty or registration you pay upfront.
Points to watch
- 5-year lock-in: you cannot sell or transfer the house for 5 years from the first loan disbursement.
- No second claim: a property gets the subsidy only once, so a resale buyer can't claim if the seller did.
- Balance transfer ends it: if you move the loan to another lender, you cannot claim again there. Run the balance transfer calculator with the lost subsidy in mind.
- False declarations on income can lead to legal action.
How Biz Corp Solutions helps
We help buyers in Thane, Badlapur and across the MMR check whether a flat fits the PMAY-U 2.0 caps, choose a lender that processes ISS claims, and file a home loan that meets both the bank's and the scheme's conditions. Learn more about our home loan service. The lender and MoHUA decide eligibility and the subsidy.
This article is based on the PMAY-U 2.0 Scheme Guidelines, the PMAY-U 2.0 portal and FAQ, and PIB material up to 21 October 2026. Scheme terms can change; confirm with your lender and the portal before you book a flat.