There are many benefits to using a home equity loan, but there are also risks involved. If you take out a home loan without understanding these risks properly, problems may arise in the future and huge losses may occur. Decide on a joint home loan with a clear understanding of the pros and cons.
Often easy home loans
Not getting approval, there are many problems. For such people, the option of a joint home loan can be very comforting. There are several benefits to taking a home loan with someone else. The biggest advantage of this is that the responsibility to repay the loan is divided. There is no financial stress on one. Husbands and wives can buy a large house with the help of a joint home loan. Apart from this, the government also gives a rebate on stamp duty. Combined home loans have advantages as well as risks. You need to know them. Results on credit score
If an applicant does not repay the loan in a joint home loan, the credit score may deteriorate. According to experts, most of the default payments are due to co-applicants, besides, when taking a joint home loan, both the applicants run out of credit limit, in case of emergency or in case of taking an educational loan for children.
In case of divorce or death
A person with a partner. If they have taken a joint home loan and then for some reason, they want to separate, then the situation becomes very difficult. According to experts, if one of the spouses stops paying the monthly installment of the home loan after the divorce, the burden of paying the debt falls on the other spouse. In such a situation, keep in mind that even if one spouse pays the other installment, he will not be the full owner of the property. In addition, if both the applicants show an inability to repay the loan, legal issues may arise. Therefore, it is advisable to consult an expert before taking out a joint home loan. Also from husband or wife, If one dies, the full responsibility for repaying the debt falls on the surviving spouse.
Proprietary rights
Ownership rights are equal in a joint home loan. Who pays the monthly installments does not affect the ownership at all. When there is more than one owner, it becomes difficult to sell the property. Unless both owners are ready, the property cannot be sold.
What are the preventive measures?
Insurance: In case of death or divorce in the future, no one will be burdened with home loans, take care while taking a joint home loan. Should take When taking a home loan, it is advisable for the main applicant to take a term insurance plan and take out insurance cover for the home loan.
Contract: Considering the possibility of future disagreements, the spouses should make an agreement to determine who will be responsible for repaying the home loan in case of a dispute. It is imperative to notarize the contract.
Benefits of a joint home loan
Large Debt Consolidation Loans: Getting a Debt Consolidation Loan, Getting a Debt Consolidation Loan, Even With Poor Credit E.g. The eligibility for a personal home loan will be Rs 30 lakh, but if there is a shortage of a few more lakhs, the eligibility for a joint home loan can be increased by another Rs 20 lakh. This means that a husband and wife can get a home loan of Rs 50 lakh. As a result, it was possible to get a bigger house.
Interest Rate Concessions: Most banks offer low-interest home loans to women borrowers. Therefore, if the main applicant is a wife, the interest rate can be reduced. Women and spouses can also get a discount on stamp duty on property registration. Different states have different rules in this regard.
Tax Savings: This is one of the biggest benefits of taking out a home equity loan. Both of them get a higher amount of tax relief. a 15 lakh tax deduction on repayment of home loans under section 80C of the Income Tax Act. Can be found. Together they can save up to Rs 3 lakh. Also, under section 24, a tax deduction of Rs. 2 lakh each can be availed on repayment of interest. This means that both of them can avail of tax savings of Rs. 4 lakhs.
Courtesy: Times group