Ultimate guide to current home loan interest rates 2018
Everyone wants to choose the finance options to buy a home that they have always dreamt of. Instead of going for sole ownership, home buyers are considering joint ownership for the benefits it has to offer. To exhaust all the benefits of co-ownership in property, it is important to make an informed decision of why one should go for it. But do we really know who is a co-owner and what advantages does a jointly owned property has to offer?
Who is a Co-owner or a Co-borrower?
Co-owners are the persons who have signed a property agreement jointly. If a person has his name on the property papers as one of the owners he is said to be a co-owner. They should have also contributed towards the purchase of the said property. Co-owner could be a spouse, children, parents or even the sibling.
A co-owner must also be a co-borrower or a co-applicant of the loan. His or her name should be present in the loan agreement. Owners who are not co-borrowers and do not pay the EMI are not eligible for the tax benefits.
It is one of the best ways to avail greater benefits, particularly if all the owners are working members and can afford a financial accountability. Joint ownership of a property, not only has tax benefits but also pooling of funds and getting a higher loan sanction are some of the advantages. Following are the financial advantages:
With the sky-high prices of property in India, buying a house is one of the most expensive purchases we make in our life. Therefore, most of the couples need to apply for a home loan together, and the home loan eligibility depends on the income of the loan applicants. However, in the case of a joint home loan, the debt burden can be easily shared between two people and also paves a way for a higher loan as two incomes will be considered.
Co-owners of a property can avail home loan tax benefit on both, the principal as well as the interest paid on the amount taken. one can claim a tax deduction of Rs.1,50,000 on the principal amount, the limit for tax deduction is Rs.2,00,000 on the interest paid. If the married couple buys a home in India in joint ownership, they both can claim for tax deduction separately. So, together the couple can get a tax deduction of Rs.3 lakhs on the principal amount and Rs.4 lakhs on the interest paid.
Trouble free property transfer
In case of sudden demise of one property holder, as per norms, the property can be transferred to the remaining owners without undertaking any legal probe. A fresh registration of the property in the name of the new owners in the presence of a solicitor. All the inconvenience can be avoided if the property was jointly owned in the first place. Therefore, joint registration of a property with your better half is always advisable to prevent unwarranted problems in the future
Jointly applying for a home loan not only facilitates higher loan eligibility but eases the repayment process. Co-owners can themselves plan on how to work out with EMIs. It is entirely up to the borrowers to decide about each applicant’s contribution towards the repayment.
Whether it’s choosing the best financing option for tax benefits or directly dealing with the seller to avoid brokerage, buyers leave no stone unturned in acquiring benefits to buy their dream home.
Visit www.thepropertist.com to buy a home you’ve been dreaming of.