Owning a home is a dream for everyone. The satisfaction of living in your own home cannot be compared to living in a rented house. The freedom, security, peace of mind, and family gatherings—all these aspects make living in a personal home uniquely satisfying. This is why people today are taking quick steps toward owning their homes with bank loans. Financial experts say that when both partners, husband and wife, take a joint loan to buy a house, many benefits come along.
Working couples are increasingly looking for private spaces in their homes to work from home. Due to changing needs, those planning to buy a home now prefer at least a three-bedroom house. To ensure the house is spacious, they must pay a higher price. Therefore, taking a joint home loan is considered a good option by experts. One person can take a loan with their father, or a couple can apply for a joint bank loan together. A father can also apply for a home loan jointly with his son or unmarried daughter. However, bank regulations state that two sisters, a sister and a brother, or a father with a married daughter, friends are not eligible for a joint home loan.
In a joint home loan, there will be a primary borrower and a co-borrower. Even if two people apply for a loan, both do not need to be co-owners of the property. However, if a property is co-owned by the wife and husband, banks prefer to give a joint home loan in both their names.
Joint home loan benefits
A joint home loan allows for a larger loan amount. If both partners are working or running a business, banks are more likely to offer them a loan, especially when planning to buy an expensive home. Compared to a loan taken by just one person, banks prefer to provide a joint loan in both names because they can recover the loan from either partner, reducing the risk for the bank. The statistics also show that defaults are much lower in joint home loans. Even if one person faces difficulties, the other can still continue paying the EMI. Therefore, this option is beneficial for both the banks and the borrowers.
Moreover, taking a joint home loan provides tax benefits for both parties. If the couple wishes to claim income tax benefits separately, they must clearly define their respective share of the EMI in advance. If only one person takes the loan, they might not be able to claim the full income tax benefit on both principal and interest. In such cases, taking the loan jointly allows both partners to claim the tax benefits. Adjusting the EMI share accordingly is sufficient for this purpose.
Under Section 24, a tax exemption of up to Rs 2 lakh is available on interest paid for home loans. The principal repayment can also be shown as a deduction of up to Rs 1.5 lakh under Section 80C. These limits apply separately to each borrower. Many banks also offer a discount on loan rates for female borrowers. Therefore, experts suggest that if a husband and wife take a joint home loan, they can avail of this benefit as well.
