With the launch of the Pradhan Mantri Awas Yojana scheme on 25th June 2015, the real estate market has got a massive shot in the arm. Also, the RERA has brought in transparency in this domain, ensuring customer trust and vendor credibility. For those who fail to avail advances under government schemes, several financial institutions provide home loans at an affordable interest rate.
Borrowers can also avail income tax benefits on home loans along with other lucrative facilities. Given below are some of the facts and tax benefits of availing home loans.
- Relaxed eligibility criteria
Lenders offer relaxed eligibility criteria to the applicants. You can calculate your home loan eligibility based on:
- Age: Individuals should be between the age of 23 and 70 years.
- Source of income: You should have working experience of more than three years and should have a regular source of income.
- Residence: You should be a resident of India and stay in any of the cities where the lender operates.
Besides, Applicants should maintain a good credit history and a credit score of 750 or above.
- Minimum documents
You can avail a home loan against minimal documentation from a reputed lender. You will have to furnish specific documents such as:
- Income proof- Account statements, income tax returns, salary slips, profit and loss balance sheets, etc. can act as your proof of income.
- KYC documents- These include Aadhaar card, PAN card, voter ID, Passport, driving license, etc.
- Address proof- Electricity bills, gas bills, water bills, telephone bills, etc. are valid proofs of address.
There are some other home loan documents required for self-employed individuals such as partnership deeds, GST certificates, SEBI certificates, etc. You will also have to provide your passport-sized photograph along with the above-mentioned documents.
- Interest rates
Lenders offer attractive housing loan interest rates and minimal additional charges. Before you avail credits, you must check such charges to make your EMIs affordable.
Several financial institutions and NBFCs offer advances at attractive interest rates. Bajaj Finserv is one such NBFC that provides Home Loan against minimal documentation at low charges. They also provide:
- Prolonged tenure up to 20 years
- Online account access
- Instant approval
- Substantial loan amount up to Rs. 3.5 Crore
- Balance transfer facilities
- Top-up loans
Do you know what are the Advantages of Applying for a Personal Loan Online
You also get to enjoy tax benefits on home loans. While you avail such loans, make use of the home loan tax benefit calculator to estimate the deduction amount on your advances. The sections under which you can claim benefits are:
- Section 80C
You can claim deductions of up to Rs. 1.5 Lakh under section 80C of the Income Tax Act. Such income tax benefit on home loan is applicable on the amount paid towards the principal component each year. Also, you can claim a one-time deduction for the stamp duty and registration charges under this section within the mentioned limit.
- Section 24(b)
You can avail tax saving on home loan up to Rs. 2 Lakh under section 24(b) of the income tax act against the amount paid as interest.
- Section 80EE
First-time homebuyers can claim an additional deduction up to Rs. 50,000 against the amount paid as interest under section 80EE of the Income Tax Act.
- Section 80EEA
Borrowers can claim a deduction of up to Rs. 1.5 Lakh if the stamp duty charges are within Rs. 45 Lakh under section 80EEA of the Income Tax Act.
In addition to these income tax benefits on home loans, most lenders offer an easy application process and allow you to apply online. To apply, visit the official website of your lender and fill up the application form with your personal and financial details. After your application gets approved, a representative of your lender will visit you to collect the documents mentioned above. Once your documents are verified, the loan amount will be transferred to your account directly.