Ask These Five Questions Before You Take Home Loan Jointly. A recent survey shows that more than 70% of Indians availing home loans to purchase a home in the country exceed their initial cost estimate by 20%. Considering the high cost of real estate in India, it is likely to become a massive financial burden if the individual has no proper plan to pay off the extra 20%.
That is why when you avail a joint home loan can help you cover unforeseen costs that arise later on. Apart from availing a higher loan amount, opting for a home loan jointly also provides several other benefits.
So, if you decide to avail of a home loan jointly, the following are a few questions you should ask to make sound financial decisions.
With whom can you opt for the loan jointly?
You can avail a home loan jointly with
- Your spouse
- Parents
- Siblings
In most cases, lenders insist that the co-applicant of the loan is also a co-owner of the property. In some cases, you can also apply for this loan jointly with your non-relatives and avail the same features and benefits.
What are the benefits you can avail by applying for a home loan jointly?
There are several benefits of availing of a joint home loan. Some of them are mentioned below.
- You can avail of a higher loan amount by applying for a home loan with a co-applicant. The amount you can avail depends on the repayment capacity of each applicant.
- There are tax benefits on joint home loan under Section 80C and Section 24 of the Income Tax Act. However, the tax benefits can be availed only if each co-applicant has co-ownership of the property.
- If the joint loan’s primary applicant is a woman, they can enjoy lowest housing loan interest rate. However, to avail of this offer, the woman either has to be the sole owner or at least co-owner of the property.
What are the eligibility criteria of availing a home loan jointly?
The joint home loan eligibility criteria are governed by the relationship between the applicants. There can be up to 6 co-applicants for a single home loan. The rest of the eligibility criteria for availing a home loan jointly are the same as a standard home loan.
You can avail of a home loan eligibility calculator to check whether you can avail of the advance.
What are the documents required to apply for a joint housing loan?
Following are the documents you need to provide to avail a home loan jointly
- Your KYC documents
- Income proof like salary slips, bank statements, etc.
- Your property documents
- Proof of co-ownership of the property
You also need to provide any other documents as required by your chosen financial institution.
Is your co-applicant’s credit score high?
If your co-applicant’s credit score is high, availing the home loan becomes significantly easier. Sometimes you can even avail a home loan with bad credit if your co-applicant has a high credit score. Additionally, it becomes easier to negotiate home loan interest rates with your lender when you co-apply for the advance with an individual with a high credit score.
These are the five questions that you should ask before applying for a joint home loan. These will answer all you need to know about a joint home loan.
However, you must also be aware that availing a home loan jointly can bring sudden repayment pressure due to unforeseen circumstances. For instance, if your co-applicant loses his or her job suddenly, the burden of repayment will fall entirely on you. That is why you must use an EMI calculator and calculate your repayment amount before applying for the loan. If you know the EMI amount beforehand, it can help you to plan your finances better for the future.