Home loans are secured and convenient loans because one can repay the loan over a period of time, thanks to the EMI option. These are usually large loans, and many people prefer to take out a joint mortgage. That said, it is also mandatory for most banks to have a co-applicant for a home loan, while some insist that the co-owner be the co-applicant as well. However, this does not necessarily mean that the co-applicant must be the co-owner. While a co-owner of a property shares the property with someone else, a co-applicant is responsible for repaying the loan, in case the primary applicant is unable to repay it.
Therefore, taking out a joint home loan has its own advantages and advantages. For example, the applicant gets approval for a larger loan amount in the case of a joint home loan and sometimes even gets a concession.
If you go for an individual loan, you will be offered a loan limit that will be much lower compared to a joint loan with your spouse. For example, if individually you are eligible for a loan of Rs 40 lakh, your loan amount could go up to Rs 60 to Rs 70 lakh if combined with the spouse’s limit. With such an increase in the loan amount, you can opt for a bigger house.
Along with this, you also get additional concessions on your home loan. If the wife is the main applicant for the mortgage, you can get the loan at a lower rate as most banks offer lower interest rates to female applicants. Other fees such as the stamp duty required to register the house are also relatively lower for women, but vary from state to state.
You can also take advantage of increased tax benefits. Many people opt for a solidarity loan only to benefit from tax advantages. You get a higher tax break with a joint home loan. For example, the two spouses separately benefit from the tax benefit of article 80C of Rs 1.5 lakh on the principal amount. Therefore, with a joint mortgage loan, you get an improved tax benefit and the limit is increased to Rs 3 lakh jointly, under section 80C. In addition, on the interest paid for an independent house under section 24, the deduction of Rs 2 lakh is increased to Rs 4 lakh, in the case of a joint mortgage loan.
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