A home is a ‘once-in-a-lifetime’ investment for many of us. It is natural that we want to make it as big and better as practically possible. Affordability is what determines the size, location, and quality of our home. No doubt, having the possibility of availing a home loan has improved affordability. However, your home loan eligibility depends on your age, income levels, other loans that you are still repaying, etc. Lenders have prudent norms which stipulate that your home loan EMI combined with all the other EMIs that you may be presently repaying, cannot exceed a certain level of your take-home pay. However, when you have already made up to your mind to get a home loan, then you can undoubtedly reach to IFL Housing Finance as they offer a variety of home loans to their clients.
Improve your home loan eligibility
One of the best ways to enhance your home loan eligibility is to add up more partners with an independent source of income. The lenders will consider your income while analyzing your repayment capacity. As a result of this, you will increase the amount of home loan that you are actually eligible for.
Who can be your partner in your joint home loan?
Considering a situation, where you need a joint home loan on an urgent basis, then an immediate family member is eligible for becoming your co-partner. This person may be salaried or self-employed or else, can be Indian as well as Non-Resident Indians or NRIs are also eligible for such loans.
Who is better, a joint applicant or joint owner?
There is a fine line of difference between the joint applicant and joint owner. As their names clearly suggest that a joint owner is a situation, where both the partners are the owners of the property. However, a joint applicant may not be the owner of the property. The basic principle of joint home loan is, all the joint owners need to be joint applicants of the home loan as well. However, it is not necessary for a joint applicant to be a joint owner as well. The income is the only criterion that is taken into consideration for the approval of home loans.
Major benefits of taking a joint home loan
On major categorization, there are two benefits of joint home loans. They are as follows:
1. Higher loan eligibility:
By pooling together the incomes during a joint home loan application, the applicants become eligible for even a higher amount of home loan. This benefit further enhances their chances of getting a bigger as well as a better home.
2. Higher tax benefits
There are numerous tax benefits to the applicants of joint home loans. For instance, tax deduction can be enjoyed by both of the joint applicants individually, knowing that both of them are the joint owners of the property. Apart from this, both of them are contributing to the repayment of the home loan.
i. You can save a lot under Section 80C:
Basic repayments are eligible for the deduction under the Section 80C of Income Tax Act, where the maximum limit of amount deduction can reach up to Rs. 1.5 lakh.
ii. You can make savings under Section 24(b)
Section 24(b) of the Income Tax Act also aids you in claiming a deduction of the amount of up to Rs. 2 lakh on consideration of the fact that your property is self-occupied. One of an amazing advantage of the joint home loan is that one can easily claim for the deduction of interests plus, principal elements of EMI. For claiming all these joint home loan deductions under Section 24(b) you need to finish up the construction of the home within 5 years of starting the loan. Otherwise, tax benefits get reduced up to Rs. 30,000 per annum.
iii. You could save under Section 80EEE
In case you are a first time home loan borrower, you can get an extra Rs. 50,000 as tax benefits on the repayment of the interest under Section 80EEE of the Income Tax Act. In such cases, the amounts of deductions are available to both of the joint applicants of up to Rs. 35 lakhs, but the property should not value more than Rs. 50 lakhs.
What becomes more important is you need to meet the eligibility criteria for getting all sorts of benefits.
Special interest rates for female joint applicants:
Some lenders are there, then, whether it is any bank or any kind of non-banking finance company, offers a differentiated home loan for women. There are some kinds of basis points that are lower than the normal rates of home loans. To take advantages of discounted interest rates, a woman has to be able to be the sole owner or the joint owner of the purchased property. Apart from this, the woman has to be the applicant or the co-applicant of the home loan.
When you should not be the applicant of the joint home loans?
- In case you are not the joint owner of the property, you should not be the applicant of home loans
- Your eligibility as an only applicant should meet your requirements for a loan.
- A low credit rating, you should not apply for joint home loans in that condition as creates a poor credit history.
- If you are repaying a loan, that is available at a maximum loan eligibility, then also you shouldn’t go for a joint home loan option for your property.
- In case you are purchasing a loan for a lower value property.
- You are about to retire in a short span of time.
The responsibility of repayment of joint home loans
There are some of the repayment responsibilities that you are attached with when you opt for joint home loans. As it is the collaborative responsibility of joint owners as well as a joint applicant for the repayments of home loans, they can also separately make the EMI payments or via joint bank account.
Last but not least, I hope that you might have found this article as a helpful tool in deciding a better home loan option. However, you can also go for IFL Housing Finance that can further make your viewpoint even clearer about home loans.