Buying a property is indeed one of the most crucial decisions for a common man; after all, a lot of efforts and a great amount of hard earned money is invested in it. Property buyers consult agents, compare rates, evaluate the property several parameters to ensure that they get the best deal while saving some bucks. In all this, usually, property buyers fail to notice some ways through which they can earn more benefits and getting joint ownership of the property is one of them. Buying a property in India on join name can be beneficial in many ways. If you are also planning to buy a property see how buying a property in joint names can be advantageous for you.
First lest see who can be joint owners in property purchase?
As per the law, there is no restriction on whom can you add as a co-owner of the property. Right from first family members like mother, father, sister, brother, sister husband or wife to any cousin, relatives or friends can be a joint owner in the purchase of a property. The contribution of the co-owner in property purchase isn’t mandatory. So even if you are independently financing the property, you can have anyone as a joint property owner.
Know the Types of Joint Property Ownership
Basically, there are 2 types of joint property ownership:
- Joint Tenants: In this type of joint property ownership, post the death of one of the owners the interest is passed to the surviving joint owner.
- Tenants in Common: In this type of joint property ownership, after the death of a co-owner the interest of departed joint property owner is passed to the legal heirs only.
Benefits of Joint property ownership
Yes, buying a property in joint names in India can bring many benefits. Let’s see what all advantages you get if you buy a property in joint ownership:
- Getting a higher home loan sanctioned: To decide the loan amount one can be eligible for, Banks consider the monthly take-home salary as a decisive factor. When you apply for a home loan jointly and both the applicants are earning, the earning of both borrowers is calculated to decide the home loan limit, which automatically increases the possibility of higher home loan. Moreover, with two loan applicants, the credibility of application increases as banks consider such cases at a lower risk of bad debts. However, banks prefer to consider joint loan applicants who are closely related, like spouse, parents etc.
- Flexibility to decide the share in repayment: In joint home loans, it is completely on the choice of borrowers that what should be the share of each of the applicant. They can plan the in what share they will repay the loan as per their own convenience.
- Easy Property Succession: Having a property in joint names has another benefit in case anything unfortunate happens with one of the property owners. In other situations, if a property owner leaves a property behind without any rightful successor, a no-objection certificate is required from other legal heirs for property succession. But in case the property is purchased in joint name, it will automatically be transferred to the other person’s name without any legal obligations.
- Income Tax Benefits: There are several benefits that can be availed in case the property is purchased in joint names. Section 80C and Section 24B of the Indian law offers several tax benefits on loan repayment and interest for home loan respectively for joint property ownership. Both the owners can claim a tax benefit of up to Rs 2 lakhs each on buying a property in joint names. When repaying the principal amount for the home loan as well, joint owners can claim a benefit of up to Rs. 1.5 lakhs each under Section 80C.
Indeed, buying a property in joint names is more beneficial than single person ownership. One can avail various monetary benefits along with several other advantages of buying a home in joint name. So, find a person you trust and venture into joint property ownership for buying property in India.