Home Home Improvement A Checklist of Tax Benefits for Joint Home Loan Applicants

A Checklist of Tax Benefits for Joint Home Loan Applicants

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Property prices in India are shooting up quite high. This has made it extremely difficult for a salaried individual to consider buying a home for himself. However, an alternative that proves to be a saving grace for most potential buyers is a home loan.

But the other thing that can help you make maximum use of your home loan is borrowing it on a joint name. In other words, opting for a joint home loan is what we are talking about. It is the same financing service but with additional advantages.

Here is an article where you will be able to find everything related to join home loans as well as its tax benefits.

What is a Joint Home Loan?

When two people decide to purchase a property on a joint name using a financing service, they can consider applying for a joint home loan.

This financing service allows two or more people to divide the burden of repaying the borrowed amount since the property is shared by them.

If you think about it, a joint home loan can prove to be the ideal solution for buying a property in a preferred location as well as of an elaborate budget. Therefore, it is becoming popular amongst borrowers as an ideal financing alternative for a buying home.

Two Main Tax Benefits of Joint Home Loan

  1. Principal Amount

Since you have borrowed a loan, you would have to pay back the principal amount one day or the other. Usually, people do it in a systematic way through monthly EMIs. The amount that you repay can now be claimed as a tax benefit. However, the limit for this is Rs.1.5 lakh. The best part about joint home loans is that both you and your partner will be able to claim the tax benefits for joint home loan with the same amount individually. Therefore, your tax benefit will double.

  1. Interest Amount

When it comes to paying interest on your home loan, it can be quite a financial hit. But according to the rules and regulations, you and your partner can both claim up to Rs.2 lakh on interest while filing your taxes. In simple words, the total interest that you can claim between both the partners will be Rs.4 lakh. However, this amount is subjected to the actual interest that you pay within a year. The actual amount cannot be less than the amount you are planning to claim.

  1. Co-applicant Not Contributing

The next benefit that you receive with the help of a joint home loan is in an unfortunate situation. In case you end up paying the entire loan amount by yourself, then also you can claim your partners’ side of interest as well as the principal. However, you would first need to prove that your partner has not been paying his share of the loan.

In other words, in case your co-applicant is not contributing towards the repayment of your joint home loan, then you can still claim additional deductions from his side.

NBFCs provides pre-approved deals for borrowers. These deals can be found for services like home loans, personal loans, business loans, and EMI finance. By using these deals, you can cut down the loan processing time in half while making it completely hassle-free.