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A joint home loan not only allows you to share your debt
burden but also allows you to extract maximum benefits offered by the IT Act.
As per the existing Income Tax Laws, both the individuals (loan applicants) can
claim income tax deductions on the principal repayment under section 80c and on the interest amount
under Section 24. The
maximum amount that can be claimed as tax deduction depends on the use of the
property ie whether it is a ‘Self occupied property’ or a ‘Let-out property’.
What is a Joint Home Loan? – A joint home loan is a loan which is taken by
more than one person.
Who is a co-borrower? – A
Co-borrower is a person with whom you take the home loan jointly.
Who is a co-owner? – A
Co-Owner is an individual that shares ownership in an asset with another
individual / group.
Joint Home Loan & Eligibility rules / Conditions
If the loan applicants are married couples then it is a perfect
arrangement for home loan providers. The couple is at liberty to decide if they
want to be co-owners or if only one of them wants to be a co-borrower.
If the loan applicants are Father & son or Father & unmarried daughter then
Lenders generally insists on the son / daughter being the Primary Owner of the
property. (This can be applicable when Mother & unmarried daughter are the borrowers)
- Section 80c – As per this section, the repayment of principal amount of up to Rs 1.5 Lakh can be claimed as tax deduction by the applicants individually. All the co-borrowers can avail tax benefits. If there are two co-borrowers then the maximum total tax deduction under Section 80c can be up to Rs 3 Lakh (subject to actual principal repayment amount).
- Section 24 – As per this section, the interest payment of up to Rs 2 Lakh (for Self occupied property) can be claimed by the home loan borrowers. If there are two co-borrowers then the maximum total tax deduction under Section 80c can be up to Rs 4 Lakh. (The maximum interest amount that can be claimed as tax deduction u/s 24 is unlimited for a Let-out property).
