If you apply for a loan jointly with your spouse, you can get a higher amount and maximum tax benefits

A joint loan is often considered a tool to enhance loan eligibility. When a borrower's income is clubbed with that of his spouse or parents, their combined income is taken into consideration by the lender. Thus, they are entitled to a larger loan and can afford a bigger house.

Banks insist that all co-owners be co-applicants. But the reverse is not necessarily true. All co-applicants need not necessarily be coowners. Some banks may have hesitations to allow brothers or sisters to apply jointly. The lender may be unwilling to take the risk of a family dispute in future that could impact the repayments due to him. That's the same reason why banks do not allow friends or distant relatives to apply jointly for a loan.

Only owners and co-owners are eligible for tax benefits in respect of home loan repayments. If you are neither the owner nor the coowner of the apartment, you will not be eligible for any tax benefits on the loan repayments.

Home loan borrowers can claim tax deduction benefits on the interest portion of the loan under Section 24(b) of the Income Tax Act. In case of a self-occupied property, the deduction on interest payable is limited to Rs 1.5 lakhs. The principal portion of the loan paid is eligible for deduction under Section 80C. Tax deduction benefits on the principal component under Section 80C is up to a limit of Rs 1 lakh.

Consider the scenario, where both husband and wife contribute towards EMI repayments. How are they eligible for tax benefits on their repayments? You will get tax benefits in the proportion to your share in the loan. Since a home loan is huge amount, the interest and principal repayment components tend to exceed the deduction limit. By applying jointly for a home loan, the co-owners can claim tax deductions in the proportion of their holding in the loan and avail maximum tax benefit.

If you apply jointly, you can increase your loan eligibility and get maximum tax benefits.