A home loan could be a major liability for you so you need to invest so much time on thinking how you are going to avail it. And then comes the joint home loan, which lowers your pain to another level.
Looking out for the benefits of a joint home loan? You have guessed it right – two people contributing to paying for a home EMI quickens the repaying term and makes it twice as fast. Time is an invaluable asset. But, getting a new home is the biggest decision when your relationship could be very fresh, so discussing the joint home loan pros and cons could be a healthy thing for both of you.
And when you are buying a home with a spouse or family member, you want more time to enjoy your time with them without distractions like a loan EMI.
What can you do about it?
- Banks allow you to take a joint home loan with a legal partner like Wife/Husband.
- You can also take a joint home loan with a family member like your mother/father brother or sister.
There are a number of joint home loan pros and cons…
The down payment
There’s no maximum limit when making a downpayment for a home loan. People usually save up before taking a home loan, and once again having two incomes comes to their rescue.
As you are making a joint decision to buy a home and are sharing the responsibility of financing it, having two incomes help in dividing the buying pressure.
- A down payment close to 15% of the home loan is on the lower side of the scale.
- Down Payments of 20%-30% of the home cost will significantly reduce the cost.
- Making a larger down payment shortens the payback term of the loan.
- Banks and financial institutions will be ready to give you a better EMI, interest rate if you make a larger down payment.
Luxury, now easily affordable
That’s right, if you want to make life wonderful, you need a home that reflects your interests and needs. New properties offer all the amenities your family could desire.
Banks are eager to offer a loan for a popular property. With a home loan shared between two partners, you can invest in a home that has a medium-to-high value appreciation, and also enjoy all the shared happiness of ownership it brings.
Two owners are better than one.
There are times when one of the partners is not able to work, and supporting the family financially is a one-person responsibility. This is not as difficult as in today’s world we are able to adapt and share family responsibility.
- Banks are flexible in the joint home loan on offer; choose a bank with a lower interest rate and a long tenure for shorter EMI.
- Do not take a loan of very long tenure, as interest rates can sometimes almost double the price of a home. So the EMI you select is important.
- The tenure of a loan influences the cost interest that is payable.
So, where are we now?
With all these advantages of taking a joint home loan, it’s time to start thinking about what could be those?
Better Loan Eligibility
By getting your incomes together, home loan applicants become more eligible for a higher amount of loan which makes bigger/better homes affordable.
Applying for a joint home loan deducts the taxes for both of you and you can enjoy the lower tax burdens separately, isn’t it just great?
With more benefits of a joint home loan, we cannot just ignore the fact that dividing the home loan will always contribute to your growth financially and mentally.
With a joint home loan, you get to cut-down your loan repayment term and enjoy your time with the family itself.