Having our own home is a dream come true for all of us. Home sweet home is the place where we reside most of the time and it is a personal asset that is carried out for generation after generation. Not all of us have the luxury of purchasing a home with the full amount in hand. When we decide to purchase a home or construct a home, there would be many charges that keep popping up and we cannot upfront decide on a fixed amount that would be spent on owning a home. So, most of us take a home loan to fulfil our wise of owning a home. A home loan is a loan type where a borrower borrows money from a lender for a fixed duration and must pay interest for the borrowed money as well. The loan would be given based on certain terms and conditions. Any person going in for a home loan commits to pay EMI to the lender. Hence, to have an idea of the EMI, they can use a home loan EMI calculator to get an idea of their potential EMIs to be paid.
A home loan can be taken by any person in India if they fit into the lender’s conditions. Many Indian states provide additional benefits to women who purchase a property. This is also done to enhance women’s empowerment. During the past years, it was uncommon for any woman to take any financial decisions as it was mainly powered by men of the family. As generation passed, women are not more financially independent, and they have the freedom to make their choices when it comes to purchasing a home. So, to increase women to be involved in creating assets, they have additional benefits on a home loan.
Let us have a look at the various benefits of home loan provided to women in India.
- Low-Interest Rate – Taking a right home loan can be beneficial for any person and can be cost-effective also. When you search for a low-interest loan, any Indian woman gets a concession on the interest rate for the home loan. The concessions on home loan for women ranges from 0.05% and 0.1%. Sometimes, you might think that this is a small amount. But if you calculate the small amount for the overall duration, a notable difference would be seen.This is since a home loan is a long-term loan that goes for about 15 to 30 years. Also, the interest concession on women would differ from lender to lender.
- Reduced Stamp Duty – One main factor that increases the cost factor is stamp duty. The state government imposes this tax on the sale of a property or transfer of it. To increase women’s empowerment and property owned by women, various states provide reduced stamp duty charges on the property that are registered on women’s names. The concession provided on stamp duty is about 1% to 2% and varies from state to state. This amount would show considerable savings in total.
- Tax Benefits – If the home loan is taken in women’s name, there would be a considerable amount of deduction on the principal amount and the interest repayment every financial year if the house is self-occupied. If the house is owned jointly, both husband and wife can claim tax deductions separately under the Income Tax Act. In this situation, the tax benefit is based on the owner’s property share as those who are both co-borrowers and co-owners could get the maximum benefits.
- Longer Repayment Tenor – For any woman, who takes a home loan, they are liable to repay the loan within a tenor of about 25 years. This would help you to reduce your EMIs thereby reducing the financial pressure. There would not be any charges levied on providing part-prepayments and for also closing the loan.
Conclusion
It is indeed a good idea to purchase a home in a women’s name or try to make them the property’s co-owner. But a woman who gets a home loan can avail tax benefits only if she has a separate income source. Besides, when you apply for a joint home loan it gets you more benefits and can increase your eligibility as well.
