Outlook Money
If you don’t meet the home loan eligibility on your own, applying with a co-applicant can boost your chances. But before you do, it’s important to understand how it works and what it means for both of you.
Having a co-applicant can make your loan approval smoother. It increases your combined income eligibility, helping you qualify for a higher loan amount and even better interest rates.
Banks usually allow close relatives as co-applicants. Spouses are the most common choice, while brothers can apply together if they share the same address.
Friends or distant relatives can’t co-apply unless they jointly own the property. In such cases, banks conduct stricter eligibility checks before approving the loan.
When both co-applicants are co-owners, they can claim separate tax deductions on interest and principal payments under Sections 24(b) and 80C, reducing overall tax liability.
Adding a co-applicant can help you borrow more. The combined income allows you to apply for a larger loan and enjoy longer repayment tenures at a lower rate.
Both borrowers share equal responsibility for repaying EMIs. A missed payment affects both credit scores, and in case of disputes or death, ownership and repayment can become complicated.
Co-applying for a home loan can be beneficial, but it’s a joint financial commitment. Choose your co-applicant wisely, read all terms carefully, and plan repayments responsibly.