According to the PF scheme, an individual can withdraw money from the PF account to buy a house, or for construction, or making some changes in the current property, after completing 5 years of employment.
To buy a house or construct a house:
If you wish to buy a house or do some construction, the loan is given against your basic salary and dearness allowance of last 36 months. It should be kept in mind that joint loan is only given if the co-borrower of loan is your spouse, in the case of PF. Also, the construction of the property shall be within six months and the construction should be completed with 12 months of taking the loan, subject to a maximum of lower of either the PF amount availability or the cost of the house.
If you are buying a constructed house, then the purchase needs to be completed within six months of withdrawal. The withdrawals can be made in one or more than one instalments, depending on the situation.
To purchase a plot:
You can purchase a plot with the help of your PF. The loan for buying a plot is given against the basic salary and dearness allowance of last 12 months, subject to a maximum of the lower of either the amount availability in your PF or the cost of plot.
To make changes in the existing property:
One can withdraw PF amount to renovate or bring some additional changes to the house owned by you or co-owned by you and your spouse. This loan can only be availed if the house has completed five years of construction. It is not necessary to carry out the changes in the same house you availed the loan for. Also, this facility cannot be availed if you have already taken a provident fund loan to purchase or construct the house. The loan is given out against the basic salary and dearness allowance of last 12 months.
You can take advantage of this facility again after 10 years from first withdrawal, depending on the situation.
For the repayment of home loan:
The provident fund scheme allows an individual to withdraw the money for the repayment of home loans that have been taken from any national bank, state housing board, development authority, housing finances companies, etc by you or jointly by you and your spouse. The amount given for this purpose is given against the last basic salary and dearness allowance of last 36 months.