5 Important Things You Should Know About Rural Housing Loan

by Nisha Scott Account manager

If you are a woman or from a weaker section of the society living in a rural or semi-urban area, you too can now fulfil your dream of being a homeowner. Lenders in India now offer rural housing loans for this purpose. Check out this post to know five important things about this loan.

In the past, only men were considered breadwinners of the family. But with the increasing number of females now opting for higher education and participating in the workforce of the country, women too now share the financial responsibilities of the household with men.

But while it is easier for a working woman in a metropolitan city to get a home loan, the same is not necessarily true for women living in rural or semi-urban areas. Moreover, even employed men living in such areas often find it challenging to get a home loan. To help them fulfil the dream of being a homeowner, some lenders in India now offer rural housing loan.

Let us have a look at what it is, interest rate, eligibility requirements, and other details about this loan-

1. What is a Rural Home Loan?

A rural home loan is similar to a housing loan one takes for purchasing a home. But apart from purchasing, the loan is also available for renovation, extension, construction, up-gradation, and repairs of a home located in a rural or semi-urban area. Many of the lenders have designed this loan product in a way that it offers better benefits and features to women borrowers as well as people from the weaker section.

2. How Much Loan Can I Get with Rural Home Loan?

With the rural housing loan scheme, you can get loans of up to 90% of the cost of the property. The loan amount can be in the range of Rs. 5 lakhs to Rs. 15 lakhs and the tenure can be up to 20 years. This ensures that the borrower has adequate time to repay the loan while also fulfilling other financial responsibilities of life.

3. What is the Interest Rate on Rural Home Loan?

Lenders offering rural housing loan generally offer it on a floating rate basis. The interest rate can be in the range of 9.5% to 11%. Factors like loan amount, loan purpose, tenure, etc. would be taken into consideration by the lender to finalise the rural home loan interest rate.

4. Is PMAY Subsidy Scheme Available with Rural Home Loan?

As the rural home loan is also a type of home loan, the CLSS (Credit-Linked Subsidy Scheme) is available for this type of loan as well. If this is your first home purchase, you might be eligible to receive credit subsidy of up to Rs. 2.67 lakhs.

5. How to Apply for a Rural Home Loan?

The application process of rural house loan is similar to that of a standard home loan. If you meet the eligibility requirements of the lender, you can fill the application form online or offline to apply for the loan. You will also be required to submit several documents with regards to your identity, address, income, etc. along with your loan application.

Encouraging Women Home Ownership with Rural Home Loan

A rural home loan is an excellent initiative by lenders to help boost women home ownership in India. Now that you know what is rural housing loan, maximum loan amount, tenure, interest rates, and more, look for a lender offering this type of loan to fulfil the dream of purchasing a home of your own.

Do check the eligibility requirements for PMAY interest subsidy and make use of the same when taking a rural home loan to save up to Rs. 2.67 lakhs on the home purchase.