PF Members to become House owners – Housing Scheme by EPFO

Are you a member of EPFO’s Provident Fund Scheme since last three years?

Is your (member + member’s spouse who is a member) PF Account balance more than Rs 20,000/- ?

If your answer is YES for both the questions,

EPFO gives you an opportunity to become a proud house owner.

Housing Scheme of EPFO

Salient Features :

1. Withdrawal under this scheme is allowed only ONCE to a member who has contributed to the fund for at least 3 years.
2. The member must be a member of the Co-operative Society or Housing Society under any law, with at least 10 members.
3. The members can apply for withdrawal of fund from his PF account for purchase of house/flat including the land from Central Govt, State Govt, Housing Society, Promoters or Builders.
4. The member is eligible for withdrawal of upto 90% of his PF account balance or the cost of purchase whichever is lower.
5. If the member avails a loan in the name of self or spouse or jointly with spouse, a choice can be made to pay monthly installments out of the Provident Fund Account to such Government, Bank or Housing Agency. Liability of EPFO is limited upto the balance in the Provident Fund Account of the member only.
6. If the withdrawal/finance granted in this scheme exceeds the expense, the balance is to be refunded in one lumpsum within 30 days.
7. If no allotment of house is made or allotment is cancelled, the sanctioned amount is to be refunded in one lumpsum within 15 days.
8. EPFO will act only as a facilitator. It will not recommend or be a party to any agreement or prefer any builder, bank, housing society, co-operative etc.
9. Members whose annual household income is less than Rs 3 lakhs(for Economically Weaker Sections) and Rs 6 lakhs( for Low Income Groups) can avail of subsidy under Credit Linked Subsidy Scheme for EWS/LIG of Pradhan Mantri Aawas Yojna.
10. Members whose annual household income is less than 18 lakhs(for Middle Income Group) are also eligible for subsidy under Credit Linked Subsidy Scheme for MIG under Pradhan Mantri Aawas Yojna.

 

How to Apply

1. The members has to apply in Annex-I to get a certificate of last 3 month’s contribution in his Provident Fund Account. Alternatively, the member can also take print out of last 3 month’s passbook from his UAN portal.
2. A Certificate of Provident Fund deposits in Annex-II will be provided by EPFO if requested.
3. The Certificate in Annex-II will help ascertain the eligibilty of members to repay loan installments to banks/lending institution. This is to fund withdrawal when the PF balance is not sufficient to purchase house/flat.
4. The member has to apply to EPFO in Composite Claim Form under para 68BD along with authorisation in Annex-III to get withdrawal or authorise payment in installments.
5. Sanction must be granted/rejected in 20 days from the date of application.

 

Analysis

1. An employed individual saves lifelong and is able to afford a house on the eve of retirement.
2. Attempt made by EPFO/Government to provide pucca houses to all EPF subscribers during employment is a laudable initiative and will make the scheme more attractive.
3. The Scheme will also make private organised sector more appealing specially for low income workers : Lifelong Pension( Pension Scheme) and House (Housing Scheme).
4. Provision of Subsidy under Pradhan Mantri Aawas Yojna made applicable to members of EPF will provide further relief to construction workers, labourers, contract workers who do not have a pucca house.
5. The scheme will also augment the government’s thrust to provide HOUSING FOR ALL by 2022.
6. Provision of withdrawing 90% of PF balance, however leaves no fund for other contingencies in life – eg sickness, marriage, education etc.
7. It can only be analysed in hindsight if houses are purchased only towards need or social security is frittered away on worthless real-estate investments.

 

Get your first house EPF members!!!