Joint Home Loans

A joint home loan is a housing loan taken by two or more individuals together to purchase or construct a home. This arrangement allows applicants, often spouses or close family members, to combine their incomes. This makes them eligible for a higher loan amount and easier approval. 

By sharing the financial responsibility, co-applicants can reduce the repayment burden while also increasing their joint home loan eligibility. Lenders view joint applications favorably as they come with shared repayment capability and lower risk. 

Joint home loan interest rates are often lower and more flexible, helping you manage repayments efficiently. You can apply for a joint loan from various lenders on Bajaj Markets to get competitive interest rates, flexible tenure options, and quick approval.

Disclaimer: The details mentioned above are subject to change at the lender’s discretion.

To calculate EMIs for a joint home loan, you can use the standard formula:

E = [P x R x (1+R)ⁿ] / [(1+R)ⁿ - 1] 

E is the monthly EMI, P is the loan amount, R is the monthly interest rate, and N is the total loan tenure. This formula determines your fixed monthly payment, which includes both principal and interest components, with the interest portion reducing over time as repayments are made.

Alternatively, you can use the home loan EMI calculator online onBajaj Markets for a more precise estimation. By entering the loan amount, interest rate, and tenure, the calculator instantly displays the EMI, total interest payable, and total repayment amount. 

It also allows comparison of offers from multiple lenders, facilitating effective repayment planning. 

The eligibility criteria for a joint home loan vary across lenders in India. The general eligibility conditions are as follows:

• You need to be a citizen of India.

• You need to be aged between:

  • 21 and 70 years, if you are a salaried applicant

  • 24 and 70 years, if you are a self-employed applicant

• Work experience needs to be a minimum of 2 years (for salaried applicants) or 5 years (for self-employed applicants).

• Generally, you would need a sCIBIL score of over 700.

• Salaried individuals must have a minimum monthly income of ₹15,000. In metro cities, some lenders may require at least ₹35,000 per month, while in non-metro cities, the minimum may be ₹25,000 per month.

• Self-employed individuals should have a minimum annual income of ₹6 Lakhs. This requirement applies in both metro and non-metro cities, though some lenders may have specific criteria.

• A residential property must be pledged as collateral.

• Your credit repayment record should show no Days Past Due (DPD) for the last 6 months.

Here are the different types of co-applicants you can apply with for a joint home loan:

Female Co-applicants

If you apply for a joint home loan with your wife, mother, or sister as a co-applicant with a regular income, you may enjoy several benefits. These include:

• You and your female co-applicant can claim income tax deductions separately on the EMI payments under Section 80(C) and Section 24(B) of the Income Tax Act

• Having two earning members as co-applicants boosts your loan eligibility due to improved creditworthiness

Parents

If your income is insufficient, you can add your parents as co-applicants to increase your overall creditworthiness. This can help you obtain the desired amount of a home loan. The tenure of a joint home loan depends, to a large extent, on the age of the oldest co-applicant. 

Thus, the loan tenure may be limited to your parents' retirement age. This may result in your EMI amount being higher. 

Siblings

If you apply for a joint home loan with your sibling(s) who has/have a regular source of income, you can get a number of benefits. These include separate tax deductions for all co-applicants and easy negotiation of loan terms. 

All the co-applicants need to provide the following documents along with the joint home loan application:

• Proof of Identity - Aadhar card, PAN card, Voter ID, Passport, etc.
• Proof of Residence - Aadhar card, driving licence, Voter ID, Passport, rent agreement, utility bills, PAN card
• Proof of Income - Bank account statements of the last 3-6 months, ITR of the last two years, salary slips of the last 3 months, and/or Form 16 for the last 2 years, salary certificate, profit and loss account, and balance sheet, business ownership proof 
• Property Documents - Past title claims, sales deed, conveyance deed, allotment letter, possession letter, latest property tax receipt, and copy of approved construction/extension
• Recent passport-sized photographs
• For NRI Individuals: Copy of Visa, Passport, Work Permit, and ID Card
• Latest degree to validate educational qualifications
• Completed and Signed Loan Application Form: A fully filled and signed loan application form by all the applicants. This form includes personal, financial, and property details, which are crucial for the loan assessment.
• Details of Ongoing Loans: Information about any existing loans (personal, car, or other home loans), including loan statements, outstanding balances, and repayment schedules. This helps lenders assess the borrower’s overall financial commitment and repayment capacity.

Applying for a joint home loan on Bajaj Markets is a simple and seamless process. You can follow the steps below to complete your application: 

1. Click on ‘Check Offer’ on this page

2. Select ‘New Home Loan’ 

3. Select your profession: either Salaried Employee or Business Owner 

4. Provide property identification status and mobile number to verify eligibility 

5. Check the terms and conditions and submit your application by clicking on ‘Apply Now’ 

By applying for a joint home loan, all co-applicants can enjoy tax benefits as per the Income Tax Act, 1961. These include:

• Section 24 (B)

You can claim a deduction of up to ₹2 Lakhs on the interest portion of the EMI. 

• Section 80 (C)

You are eligible to claim a tax deduction of up to ₹1.5 Lakhs on the principal portion of the loan EMI.

When you take a joint home loan, you might come across two terms – co-applicant and co-owner. These are not the same.

A co-applicant is someone who applies for the loan with you to improve your eligibility. Their income is added to yours, which can help you get a higher loan amount. 

A co-owner is someone who shares the ownership of the property with you. If a person is a co-owner, they also need to be a co-applicant. But if someone is just helping with the loan and doesn't own the property, they can be a co-applicant without being a co-owner.

In some cases, like when a woman is added as a co-applicant, most lenders require her to also be a co-owner to offer lower interest rates.

Before you apply for a joint home loan, here are a few important factors you need to be concerned about:

• Documents

Make sure you and your co-applicant have all the necessary documents ready. These include KYC documents, income proofs, and property-related papers. Having everything in order can help speed up the approval process.

• Home Loan Amount

Have a clear idea of how much loan you actually need. You can use the free home loan calculator available on Bajaj Markets to estimate the right amount based on your income and repayment capacity.

• Credit Score

Lenders check the credit scores of both applicants while evaluating your loan application. If either of you has a low score, it could impact your chances of approval or affect the joint home loan interest rate offered. So, it is best to check and improve your credit scores before applying.

• Loan Repayment Responsibility

Both you and your co-applicant will be equally responsible for repaying the loan. You can choose to pay EMIs from a joint bank account to manage it smoothly. Remember, any delay or default by one applicant can affect the credit history of both.

Each co-borrower is liable to repay the loan with applicable interest, regardless of their share in the property. Their loan share is also important in determining the repayment schedule and tax deductions claimable. 

Unless the property agreement states otherwise, it will be assumed that each co-owner owns an equal share of the property. To understand this better, let’s take the example of two applicants, Mr. Ram and Mr. Suraj, who have a loan share of 60:40. 

Here, the loan EMI amount is ₹10,000 and they are liable to pay the same as per their loan share. This means, the instalment will be split into ₹6,000 and ₹4,000, between Mr. Ram and Mr. Suraj, respectively. 

Similarly, the tax exemption will be calculated on each individual’s share of the EMI paid. So, for Mr. Ram, the deductions will be calculated on the ₹6,000 paid by him each month. Bear in mind that the total exemption claimed by all co-borrowers cannot exceed the actual EMI payment made to the bank.

Provided below are some common conditions you should fulfil before applying for a joint home loan to have a better chance of getting your application approved:

• You can have a maximum of 6 co-applicants and a minimum of 2 co-applicants for a joint home loan

• You cannot avail a joint home loan with any random individual, including your friend/s or business partner/s

• Each co-applicant has to fill in a separate application form and provide individual documents for the same 

• Repayment for a joint housing finance plan can be done through a joint account of the co-borrowers or by splitting the EMI equally or proportionally among them

While applying with a co-applicant can boost your loan eligibility and offer tax benefits, there are situations where going solo might be the better option. 

Here’s when you should reconsider adding a co-applicant:

You’re Eligible on Your Own

If you qualify for the home loan by yourself, there's no need to add a co-applicant. This way, you can preserve your spouse’s eligibility for future loans.

Your Credit Score or Existing Loan Affects the Application

If your credit score is low or you’re already repaying another home loan, having a co-applicant might not significantly improve your eligibility. In such cases, the advantage of co-application may be limited.

You’re Buying Property as an Investment

Adding a co-applicant makes more sense when you're purchasing a home to live in. For investment properties, a joint loan may not always be necessary.

Shared Responsibility Can Get Complicated

Keep in mind that a joint loan means shared responsibility. If this isn’t clearly defined, it could lead to issues, especially in situations like legal separation or divorce.