Under EPFO’s new rules of 2026, PF money can be withdrawn to buy, build a house or to repay a home loan. Withdrawals up to 90% are possible with certain conditions (e.g. 3 years of service).
Thinking of using Provident Fund (PF) money to buy your house or reduce the burden of your existing home loan? If yes, then it is very important for you to know the new rules of Employees Provident Fund Organization (EPFO) for 2026. Under these rules, you can withdraw PF money for household related purposes only after fulfilling certain conditions. EPFO says that if the rules are not followed, your application may be delayed or it may even be rejected.
How much money can be withdrawn to buy a flat or build a house?
According to EPFO’s Housing Scheme (Para 68-BD), employees who have completed at least three years of service can withdraw up to 90% of the total amount deposited in their PF account. The condition is that their PF account should have a balance of more than Rs 20,000. Whereas, under Standard Advance (Para 68-B), employees who have completed 5 years of service can withdraw an amount equal to their 36 months’ basic salary and dearness allowance (DA) or the actual value of the property (whichever is less).
Keep these important conditions in mind
If you are buying a house with PF money, then the deal should be completed within 6 months of receiving the money. The property should be registered in joint name with you or your spouse. PF money cannot be withdrawn to buy property in the name of a third person like parents or siblings. Home builders will have to start construction within 6 months of withdrawing the money and complete the work within 12 months of receiving the last installment.
PF can also be withdrawn to repay home loan
You can also use PF money to repay your existing home loan. For this you may need 3 to 10 years of service, depending on the institution giving the loan. You can withdraw up to 90% of your PF balance, but this amount cannot exceed your outstanding loan amount. Another special thing, this money will not come to your bank account, rather EPFO will transfer it directly to the loan giving bank or housing finance company. For this you will have to provide certificate of outstanding loan from the bank.
There is also facility to buy land
Minimum 5 years of service is required to purchase a plot or land. You can withdraw an amount equal to your 24 months’ basic salary and DA or the actual value of the land (whichever is lower). You will get this facility only once.
Think before withdrawing PF money
PF money is a great financial security for your life after retirement. Therefore, premature withdrawal can have a negative impact on your long-term savings. For example, if you withdraw Rs 5 lakh at the age of 30, you will miss out on the long-term interest and compounding benefits of that amount. Therefore, financial experts recommend considering other options first and using PF only as a last resort.