Are you the one who is planning to buy a home of your dream, but concerned due to high interest and taxes? Then you need not worry anymore. We are here to guide you on how you can jointly take a home loan and buy a home easily.
As unity means a strong bond, similarly joint home loan also plays a strong role in your life while buying a house. Joint home loan definitely lowers the burden of your debt and allows you to get a higher amount of loan. The interesting part is - you can avail the loan with the help of more than 6 co-applicants, but one should have a blood relation.
1. The borrowing way: You can borrow the loan while taking the help of his or her spouse, parents, or close siblings. Co-owner and the borrower should have a close blood relation. One has to understand that co-owner is the one who has a share in the property and co-borrower is the one who is responsible to pay the amount of the loan. But some banks also allow the co-owner to pay the loan amount in a joint home loan. It depends on banks to banks.
Ashwinder R Singh, Group Business Head-Home Loans, Bajaj Housing Finance Ltd. says- “A joint Home Loan is comparatively cheaper, as most of the financiers offer a lower rate to women borrowers with varying conditions that change from lender to lender.”
Most importantly, couples in a live-in relationship, brothers-sisters and friends are generally not allowed to take a joint home loan. While borrowing a loan the retirement age is very important. The tenure of the loan depends on the joint holder's retirement age as well. Married couples can take a loan of maximum 20 years of tenure, but the retirement age of the applicant is noted here as well. Co-applicants age limit also plays a major role in the tenure of the joint loan amount.
2. Documentation: Income proof of both the applicants is very important while taking a joint home loan. Else, KYC is needed along with address proof of both the applicants.
3. Double your tax benefits: Remember that an individual gets the tax benefit of Rs 1.5 lakh on a home loan under Section 80C and Rs 2 lakh benefit under Section 24(b). But the case in joint home loan is different. Suppose a couple has taken a loan on 50:50 ratio, then both the co-borrowers can avail the tax claim and benefits individually. This means they will get jointly 3 lakh limit benefit under Section 80C and 4 lakh under Section 24(b). The ratio totally depends on mutual understanding of the co-borrowers. The higher the ratio of anyone, the higher share and tax benefits one can avail.
Sudhir Kaushik, Taxspanner.com says, “Joint home loan is good for those having taxable income for both husband and wife because home loan interest and principal benefit under section 80 C would be just double."
4. The process of repaying the loan: As we explained earlier that mutual consent is very important in a joint home loan. So, the repayment process can be paid by single or both through the joint account holder’s cheque or through online process auto-debit EMI system monthly. The repayment can also be done with the help of one co-borrower and the other one can get the refund of money from his or her borrower.
Apart from the above points, it is very important for both the co-applicants and borrowers to maintain their CIBIL as well. Else, they might not get the joint home loan. Read the terms and conditions properly before availing the benefits jointly to fulfil the dream of owning a house.
“Last but not the least, one can buy a larger house and in a preferred micro market due to the income of both applicants getting clubbed by the lender to calculate home loan eligibility, which obviously comes higher in comparison to what it would be if only one person's income is taken”, says Singh.