by Mr. Abhishek
Agarwal, Creditvidya.com
House buying is both
an overwhelming & a satisfying decision.
These days home
buying is enabled by housing loans in most cases, unlike earlier days where
people used to save up money for years before they bought a home.
Your housing loan
eligibility can go up substantially if it is a joint housing loan, which might
help you in buying a bigger or / better house. We tell you all you need to know
about joint housing loans.
Housing loan
eligibility is not the only benefit of taking your home loan with your family
member.
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| Mr. Abhishek Agarwal, Creditvidya.com |
Since there is no
much material available on this subject, we have put together a fact sheet on
taking a joint housing loan.
Following are the
Five most important facts of joint housing loans:
1. Co - Applicants'
Definition..!
This is the most
common question one asks.
A co-applicant is the
person who jointly takes a loan along with you. It is important to understand
the difference between a co-applicant & co-owner.
A co-owner includes
all the owners of the property. Banks insist all the co-owners be co-applicants
necessarily. Hence, all co-applicants may not be co-owners but all co-owners
have to necessarily be co-applicants. A co-applicant can be your spouse
(Husband or wife), parents, siblings or son.
2. Paperwork..!
In case of a joint
housing loan, both the applicants require to submit all documents required for
processing the loan like, Permanent Account Number (PAN) card copy, address
proof, income proof, bank statements & documents relating to the property.
3. Increase in loan
eligibility..!
This is one of the
biggest benefits of joint housing loan. The lenders will consider the income of
all the applicants thereby increasing the loan eligibility value.
4. Repayment
liability..!
When you are a
co-applicant in the loan, the lenders make you also liable to repay the home
loan amount. So, the responsibility of repaying the loan is on the shoulder of
the co-applicant as well.
If one of the
borrowers fail to pay, the responsibility of footing the equated monthly
installment (EMI) automatically shifts to the other borrower.
5. CIBIL Score...!
This is the most
important part in the case where you are considering higher loan eligibility as
the main reason of availing a joint housing loan.
If all the applicants
in a joint housing loan have a good CIBIL score, then it is a cake walk to get
a loan approval. If the one of the applicants has a bad CIBIL score then the
lenders do not consider his / her income to increase eligibility. But, the lenders
do make exceptions in certain cases.
Considering the
income of a person who has a bad CIBIL score is completely at the discretion of
the lender.
So, it is important
to understand that joint housing loans do come with a great deal of benefits
along with proportionate liabilities. So, if you want to enhance your loan
eligibility, approach your blood relatives. But, make sure you have a clear
strategy to repay back the higher loan amount on time.
Note: Tax benefits..!
Now when you are
equally responsible for repaying the loan, it is but logical that you get to
enjoy the tax benefits as well.
Under section 80C of
Income Tax Act (IT-Act), a housing loan borrower is eligible for tax benefit of
principal repayment of up to Rs. 1.5
lakh and Rs 2.5 lakh of interest repayment under section 24 of the same
act.
In case of a joint
housing loan, both the applicants are eligible to enjoy these benefits
proportionate to the extent of contribution towards repayment.
About Mr. Abhishek
Agarwal..!
Co-Founder & Director, Creditvidya.com
Mr. Avi is a personal
finance expert whose sole mission is to empower people to save money by taking
smarter financial decisions.
Mr. Avi has an MBA
from UCLA Anderson School of Management and London Business School.
E- mail :
abhishek.agarwal@creditvidya.com
web site: www.creditvidya.com
Free Credit
Counselling
022 - 4012 4545
info@creditvidya.com
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