A nomadic existence of shifting around from one rented property to the next, year after year, does begin to take a toll on the family life. The older you get, you yearn for a house of your own with a wide, sunny porch and a big garden where your children can play and your ageing parents can enjoy a hot cup of tea on winter afternoons.
You visit a lender to learn about how quickly you can avail a loan and get started on building your own dream house. You leave the lender’s office with the image of the sunny porch quickly disintegrating after hearing of outrageous interest rates on Equated Monthly Installments (EMIs) and the lender’s unwillingness to sanction your loan owing to your less-than-ideal CIBIL score.
Fortunately, not all is lost. You can still have your dream home! You can apply for a joint home loan with other individuals which would not only significantly improve your home loan eligibility but also ensure better tax benefits for the borrowers. While applying for a home loan in your own personal capacity will provide you with a tax benefit of up to Rs. 1.5 Lakh under Section 80C and Rs. 2 Lakh under Section 24 of the Income Tax Act, 1961; applying for a joint home loan in the ratio of 50:50 allows co-applicants to claim these benefits separately and thereby increase their tax exemptions.
With a joint loan, everything becomes easier right from your eligibility for taking the loan to having the requisite support for paying it back on time. However, certain conditions must be fulfilled for those wishing to apply for a joint home loan. Read on to learn more about home loan eligibility.
In most cases, lenders will wish to understand the relationship between the co-applicants for a joint home loan. Married couples can easily apply for a joint home loan together, while lenders lay down certain rules regarding eligibility when siblings or parents wish to act as co-applicants. For example, a brother and a sister cannot be co-applicants for a joint home loan and neither can a married daughter and her parents. In case of an unmarried child, whether son or daughter, wishing to apply for a joint home loan with their parents; certain rules regarding ownership of the property will apply which you can read about in the next point.
While applying for a joint home loan, lenders will wish to know of the person in whose name the property to be purchased is to be registered. If there are co-owners to a property, then both must apply jointly for the loan. If either parent (whether mother or father) of an only son wishes to co-own the property with their son, then either owner can be the primary owner as the property is registered in both their names. If there is more than one son, then the father or mother cannot be the primary owner of the property purchased through a home loan. If an unmarried daughter wishes to apply for a joint home loan with a parent, then the property has to be registered in the name of the daughter only.
The CIBIL report of co-applicants will greatly determine their eligibility for applying for a joint home loan. If one applicant has a low CIBIL score, lenders will ask the other applicant to be the primary applicant for the loan. Primary applicants will usually be the person paying the greater share of the joint home loan EMI. In cases where a child has a low CIBIL score, their chances of having a house loan sanctioned is greatly enhanced by applying with a parent whose CIBIL score is higher. You can even check home loan eligibility using our home loan eligibility calculator.
Since loan amounts generally take into consideration the income an applicant draws, a joint home loan provides a person with a low income with the opportunity to apply for a higher loan amount than they may have, in their own capacity, been unable to avail. However, clubbing of incomes resulting in an increase in the amount that can be loaned to co-applicants only works when both applicants are employed and drawing a regular salary. Additionally, if an unmarried daughter seeks to apply for a joint home loan with a parent, the parent’s income is not taken into consideration while calculating the loan amount that can be availed; even if the parent is employed and drawing a salary.
With a Bajaj Finserv Home Loan, available on Finserv MARKETS, you have even greater flexibility on choosing a home loan repayment tenure up to 300 months. Since there are no charges for prepayment or foreclosure of your Bajaj Finserv Home Loan, you can rest easy knowing that you are setting your own terms.
Also, read about home loan procedure.
Finserv MARKETS, from the house of Bajaj Finserv, is an exclusive online supermarket for all your personal and financial needs. We understand that every individual is different and thus when you plan to achieve your life goals or shop for the gadget of your dreams, we believe in helping you Make it Happen in a few simple clicks. Simple and fast loan application processes, seamless, hassle-free claim-settlements, no cost EMIs, 4 hours product delivery and numerous other benefits. Loans, Insurance, Investment and an exclusive EMI store, all under one roof – anytime, anywhere!