For most salaried employees in India, buying their first dream home is the goal but saving enough for the down payment can be the biggest challenge.
The good news? Starting from July 2025, the EPFO has made a major change under Para 68-BD of the EPF Scheme, 1952, which can help make this dream come true.
Let’s dive in and break down what’s New PF Withdrawal Rules 2025 Major Relief for First-Time Homebuyers, how it helps, and what you need to know before using your PF for home purchase.
What’s New in PF Withdrawal Rules 2025?
Here is what the new PF Withdrawal Rules 2025 say:
- 90% PF withdrawal for buying a home: You can now withdraw up to 90% of your combined EPF and EPS balance for purposes like purchasing, constructing, or repaying the loan amount for your first home. Before, you had to wait for 5 years and now it is just 3 years.
- Use it in multiple ways: This money can be used not just for down payments, but it can also be used for home loan EMIs or for building a house.
- One-time use only: You can use this new benefit only once in your lifetime under this rule. So make sure that you use it smartly and wisely.
Why This Is a Big Deal for First-Time Homebuyers
1. Helps You Manage the Down Payment
For most salaried employees, saving enough money for a down payment is the most difficult part of buying a home. This new rule allows you to use your own PF savings to overcome obstacles without taking loan or borrowing money from family.
2. Boose for the Housing Market
Builders in cities like NCR, Pune, Indore, Lucknow, Noida, and Greater Noida have already seen a growth in home enquiries after this new rule was announced. Many people who were waiting to buy are now regularly looking.
3. Encourages Legal and Safe Home Buying
The rule is expected to boost more buyers in the direction of legal and organized housing projects, instead of unapproved or risky properties. This also improves transparency and supports financial inclusion.
Other Key PF Updates in 2025
The EPFO has made a few more crucial changes in 2025 that make it easier and faster to access your PF money:
- Instant UPI/ATM withdrawals: Starting from June 2025, you can now instantly take out up to ₹1 lakh using UPI or ATM for urgent needs like medical emergencies.
- Faster auto-claims: You can now claim up to ₹5 lakh, which can be auto-settled without manual checking. This update speeds up the whole process easily.
- Simple paperwork: Earlier, you needed 27 types of documents to claim verification, which was a lot to handle. But now it’s just 18 types of documents. Also, 95% of claims are cleared in 3 to 4 days.
- Easier partial withdrawals: Even if it’s for education purposes, medical expenses, or wedding expenses, the partial PF withdrawal process now became simple and much quicker.
Who Can Use the 90% PF Withdrawal Rule?
Here are the requirements you must fulfill to use this Para68-BD rule:
- Your PF account must be at least 3 years old.
- You should be buying a home for the first time.
- Your money must be used for buying a house or flat, building a new home, or paying home loan EMIs only.
- You can make use of this facility only once in a lifetime.
- You don’t have to be part of any government housing scheme.
How to Apply: Step-by-Step Guide
Here is how you can apply for this PF withdrawal for home buying:
- Check your KYC: Always make sure that your UAN is KYC-verified with Aadhaar Card, PAN number, and bank details.
- Log in: Visit the official EPFO Member Portal – www.epfindia.gov.in or simply use the UMANG App.
- Start a claim: Go to the Online Services and start claiming under Form 31.
- Select Purpose: Choose the purpose by selecting “purchase or construction of residential property” from the options given.
- Enter Amount: You can request the amount up to 90% of your total PF balance.
- Upload Documents: Submit property papers or proof of your home construction/purchase.
- Submit and Wait: After submitting all your documents and proof, most claims get settled in 3 to 4 working days.
Things to Keep in Mind
Before you go ahead for the claims, here are some of the important points about the PF Withdrawal Rules 2025:
- Tax applies if you withdraw money before 5 years:
- 10% TDS if your PAN number is linked
- 30% TDS if your PAN number is not linked
- This is valid only if the withdrawal is ₹50,000 or more
- This is a once in a lifetime withdrawal, which is under Para68-BD. You can’t use it again for future property purchases.
- PF is only meant for retirements, so only withdraw what you really need. Make sure you still have enough money left for the long-term future by using your PF wisely.
Expert View & Real Estate Impact
Industry experts believes that, this is a smart and timely move:
- Abhishek Raj from Zenica Ventures says that this change removes the major roadblocks like the down payment for salaries of homebuyers.
- Pawan Sharma of TGR Group shares that after this rule update, there’s been a noticeable increase in home buying interest across high-growth sectors.
- Financial advisors still advise caution: It’s great to use PF to buy a home, but don’t forget that it’s your retirement safety net at the same time.
Final Thoughts
The 2025 PF withdrawal changes, especially the new Para68-BD rule, which is a major boost for first-time homebuyers. With fast access to funds, less paperwork, and the ability to use savings for down payments or EMIs, owning your first dream home is now much more achievable.
But remember, PF is also your retirement fund. So plan your withdrawal carefully and smartly.
FAQs
Can I withdraw PF for my first home after 3 years?
Yes, you can withdraw up to 90% of your PF after 3 years to buy or build your first home under Para68-BD.
How many times can I use this benefit?
You can use it only once in your lifetime.
Is KYC mandatory to withdraw PF for housing?
Yes. Your UAN must be KYC-verified with Aadhaar, PAN, and your bank account details.
Will tax be deducted from my withdrawal?
Yes. If your account is less than 5 years old, then 10% TDS is available if PAN is linked, 30% TDS is available if PAN is not linked.
How fast will the money be credited?
It can be processed within 3 to 4 days because of reduced documentation and auto approva systems.