If you can and meet requirements, it is always a better proposition to take a joint home loan in India. Let's say that Sanjay, decides on buying an apartment of Rs 90 lakhs and the home loan company gives him a loan of Rs 40 lakhs, in place of Rs 70 lakhs that he desires.

In this case, if his wife is working, she can apply for a joint home loan.

Let's check the advantages of a joint home loan:

1) Tax benefits for both home loan applicants

Tax Benefit on Home Loans are immense. First, for payment of Interest component of the loan, a deduction under Section 24 of the Income Tax Act up to Rs 2 lakhs has been permitted for a self occupied residence.

For a residence that is not self occupied no limit has been set.

Now, if interest payment is made by both the loan applicants, you get tax benefits on interest paid up to Rs 4 lakhs (2 lakhs each).

For the principal amount of the loan one gets a tax benefit of Rs 1.5 lakhs per year under Sec 80C. Now, here again by taking a home loan jointly, both applicants can get a joint tax deduction of Rs 3 lakhs on the principal amount paid.

So, whopping tax benefits of Rs 7 lakhs for home loans taken for a self occupied property jointly by the co-applicants. It can get much higher, if the house if not self occupied.

2) Sizeable loan amounts

One needs to hardly explain the fact that, if you apply jointly, the total income is taken together and you get a higher loan amount. In the above case, Sanjay will get a much higher loan amount and he can meet the shortfall, through the loan of his wife.

3) Loan approval chances are much better

The chances of getting a loan approved is much better, when there are two applicants. In fact, if the documents are in order, it is almost certain that your loan would sail through.

Of course, having said so, it is important to remember that if one of the loan applicants default, it is the responsibility of the other home loan applicant to pay the EMI. Higher the loan, higher the amounts to be paid.

Also, it is important to understand that the loan, maybe sanctioned only if blood relatives are the co-applicants. You cannot catch somebody at random and make him or her theco-applicant of the loan.

It is also important to understand that both the applicants must understand their obligations and make good the EMIs. No disputes should emerge, that may jeopardize the loan re-payment.

We wish to re-iterate that as and if possible it is advisable to go for home loans. This is the only loan that gives you immense tax benefits. Both co-applicants together can get a big ticket loan. The documents would have to be seperately furnished for each applicant.

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