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Magicbricks is a full stack service provider for all real estate needs, with 15+ services including home loans, pay rent, packers and movers, legal assistance, property valuation, and expert advice. As the largest platform for buyers and sellers of property to connect in a transparent manner, Magicbricks has an active base of over 15 lakh property listings. According to Section 80C and Section 24, the borrowers can claim tax exemptions up to Rs 3.5 lakhs on principle payment and interest rate.
However, if the co-borrowers jointly own a piece of land they cannot avail any tax deductions as the house would have to be constructed on that plot. Before applying for a loan one must always check the interest rates charged by each bank. Also, some banks charge various processing and other related fees when applying for a loan. If one applicant is earning and the other is unemployed, then one should not apply for a joint loan. In this case, no doubt the loan offered would be higher, but then so will be the burden to repay the same loan without any external income from the other applicant.
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The best situation for taking a joint home loan is with a working spouse. You can pool your incomes together and apply for a higher home loan. This way, you will have the support of your spouse for repayment, and both of you will get double tax benefits. There are many benefits of taking a joint home loan instead of taking a home loan just by yourself. First and foremost is the benefit of getting a higher loan amount. If you want to purchase a large home, you need a huge loan amount.
While applying for a joint home loan, it must be ensured that both the co-applicants are employed and are drawing a decent salary that can help them easily repay the debt. Siblings who are co-owners of the property can also apply for a joint home loan. Parents are eligible to be co-applicants for a joint home loan as long as they are earning, and hence, in this case, the tenure will be short as they will be approaching retirement soon. Taxes are levied on each individual's portion of a residence that is owned under joint ownership. A BOI or Association of Persons cannot be taxed if your part in the common property is definite or ascertainable . If the borrowers or co-applicants are a married couple, the tenure of the loan can be as high as at least 20 years, restricted to the retirement age of the older applicant.
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Tax benefit on loan for an under-construction property is not applicable if you repay the principal amount during the pre-construction period or if the loan is taken to buy the plot. • The exemption under this section is valid only if the construction of the property is completed within 5 years from the application of the loan. Else there will be a reduction of only Rs.30,000 on the payable interest rate.
How can both husband and wife claim home loan interest?
Banks and lenders won't care if a borrower divides the loan amount with a family member or a known individual. With a combined home loan, your chances of getting a larger loan with lower interest rates increase. Each joint owner's payment history can be used to determine their portion of the house loan. Preparing an unstamped Memorandum of Understanding to identify the various interests of each joint owner in the property is always recommended to avoid future problems. Payment information for each joint owner might be included in a memorandum of understanding.
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This makes it easier to track the contributions as well as enable ease of repayment. How can I increase my chances of being eligible for SBI's home loan? The eligibility criteria for women are the same as for other applicants although women borrowers are given an interest rate concession of 05 basis points.
Both parties will have to produce comprehensive paperwork stating the same to receive the tax benefits. To take advantage of the joint home loan tax benefit, you'll need to get this paperwork from your bank's branch. Searching for a perfect home can be a long and exhausting process. Your home should meet your preferences, comfort, and, most importantly, your budget.
You can opt for cheque or electronic clearance/standing instruction to your bank, as per your convenience. A home is a haven, your own little paradise to share with your loved ones. Owning a home has become easier with the availability of home loans offered by various banks and financial institutions at attractive and affordable interest rates. The real problem lies in choosing the right options that will ensure that you avail a home loan that is best suited to your needs. The right home loan scheme helps to increase your savings and reduce the burden of debt.
The problem happens when you try to apply for a higher loan amount, and the banks do not grant it. A joint home loan can increase the chances of getting a higher home loan amount. Expect for the statements UNION Bank of India is doing good when it comes to housing loan. The process was a bit lengthy ultimately I had taken loan from Union bank of INDIA. Joint home loans are definitely an option worth considering since it has several benefits when compared to a regular home loan. If you are looking for a home loan, it is better to plan a joint home loan with your family members.
It's important to note, though, that you must be a co-owner of the property to qualify for the tax savings that come with the joint ownership declaration form. Only then will you be able to deduct the principal repayment and interest payments from your taxes. Ensure all joint owners are not claiming identical interest or principal payments as tax advantages. Others in the group must sign a No-Objection Certificate stating that they will not be claiming any tax advantages on that amount.
A joint home loan is a loan that can be availed by two or more people to purchase a house. It is mandatory for the co-applicants to be financially independent so that the debt is equally divided and repaid by each of the two. If the joint applicants of the loan are joint owners of the property, they can also boost several tax exemptions. As soon as you acquire the property, your ownership stake is set in stone.
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