Purchasing a home is the most heavy-duty expenditure that we take up. At the same time, owning a house gives us immense pride and happiness. However, it involves plenty of apprehensions such as repayments, tenures, and opting for the most economical plan.
Considering procuring a house incurs loads of money, banks and non-banking financial companies (NBFCs) have the concept of joint home loans in place.
What are the other benefits of opting for a joint home loan?
1) One of the primary advantages of joint home ownership is the eligibility for certain tax benefits under two heads of Income Tax Act, 1961:
· The customer can enjoy interest rate deduction for self-occupied property up to INR 2 lakh as per section 24B
· The customer also receives a tax exemption on the principal amount of the housing loan up to INR 1.5 lakh under section 80C
2) The borrowing capacity increases by pooling more co-applicants. How? By portraying income proofs of the co-applicant as well as the customers. That way the user can purchase a bigger and better house.
3) If the customer’s co-applicant is a woman, she is entitled to further discounts on interest rates. However, to use this benefit, the lady must be the co-owner of the property.
Combination of a joint mortgage:
The joint home loan in India allows a maximum of six members. Remember, the co-applicant may or may not be the co-owner of the property. However, lenders prefer the co-applicant to be a co-owner of the asset. The following blend works for joint credit:
1) Husband and wife: Lenders consider married couples as the ideal combination. The couple have the liberty to either be the co-owners or one of them be the co-borrower
2) Father and son: When it comes to the father-son duo, lenders verify if the son is the sole heir. If a sibling exists, then lenders insist the son to be the owner of the possession
3) Father and unmarried daughter: In this scenario, lenders require the unmarried daughter to claim the property
4) Mother and unmarried daughter: They are eligible to a joint home loan if the unmarried daughter is the primary owner of the property
5) Brothers: The lenders grant the investment only if the brothers are co-owners of the asset. They also sanction the loan if they are living or intend to live together in the invested property
To sum up, a joint venture is a lucrative option. However, do not take the plunge blindly. Know you co-applicant, discuss the possible scenarios with your lender and make an informed decision accordingly.
