PMAY-Urban 2.0 Explained Simply
Updated 1 Sept 2026 · 5 min read
Who can get help under Pradhan Mantri Awas Yojana Urban 2.0, how the home-loan interest subsidy works, and how to apply.
PMAY-Urban 2.0 is the second phase of the central government's urban housing mission, approved in 2024. It aims to help urban poor and middle-class families own or rent a decent home.
The four ways it helps
- Beneficiary Led Construction (BLC): financial help to build a house on your own land.
- Affordable Housing in Partnership (AHP): subsidised flats built by states, cities or private partners, often allotted by lottery.
- Affordable Rental Housing (ARH): rental homes for migrants, workers and students.
- Interest Subsidy Scheme (ISS): subsidy on home-loan interest for EWS, LIG and MIG families.
Who is eligible
Families (husband, wife and unmarried children) with annual income up to ₹3 lakh (EWS), ₹3–6 lakh (LIG) or ₹6–9 lakh (MIG), who do not own a pucca house anywhere in India.
Interest subsidy in brief
For loans up to ₹25 lakh on homes costing up to ₹35 lakh, a 4% interest subsidy is given on the first ₹8 lakh of the loan, for up to 12 years. The total benefit is up to ₹1.8 lakh, released in yearly instalments into your loan account through the bank.
How to apply
Apply through the official PMAY-Urban portal or your city's urban local body. For the interest subsidy, tell your bank / housing finance company when you apply for the loan. They verify and claim it. You never need to pay an agent to 'get PMAY approved'.
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