Buying a home is a decision that’s made in the mutual interest of a family. Most homebuyers take the house buying decision only both spouses are ready for an equivalent. In countries like India, apart from the downright financial value, homes “house” an emotional sentiment and when both the partners have accepted the home buying decision wholeheartedly, the value of the property enhances through the emotional bond. Most families have adapted to the idea of a nuclear family with both the homeowners usually working. Adding your spouse as the co-owner of the home gives your partner an opportunity to enjoy the feeling of co-ownership while enabling financial additional benefits too.
Single owned homes vs. co-owned homes
Since buying a house is a big decision, and a lot of time and effort goes into finding a suitable house that fulfills the needs of all family members. It involves a large amount and a lot of times its major chunk of people’s life savings so it’s better to be prudent about every small detail around the buying decision.
Individual or sole ownership is beneficial for the titleholder in many ways. They hold the sole right and if they want to sell the property, no additional permission from any third party would be required. The division of such a property is also easier, because of the limited number of owners. When the owner dies, his property would be transferred under the provisions made in his will and if there is no will then the specific inheritance laws would apply and the property would accordingly be transferred among the legal heirs or next of kin of the late owner.
When a property is registered in the name of more than one individual, the immovable asset is deemed to be under joint ownership. Those holding the title to the property in such ownership, are known as joint owners or co-owners of the immovable asset. It is pertinent to note that there is no difference between joint ownership and co-ownership of property under any law and the two terms can be treated as synonymous. Joint ownership brings tremendous financial benefits to both the co-owners.
Why is it important to add a spouse or a partner while buying a home?
It makes total sense to add a spouse as co-owner as it helps in enhancing loan eligibility and provides tax benefits to both co-borrowers on interest and principal repayment. The succession process of a jointly owned property is much smoother in comparison to the lengthy process involved in the case of single ownership.
The benefits are as follows:
Low stamp duty charge: Stamp duty fees for registration of property are higher for male buyers and lower for women. If your property is of a high value, the charges will be more. Therefore, adding your spouse to the ownership of the property will make you save a considerable amount in stamp duty charges.
Improves the loan eligibility: The loan eligibility of a person depends on his/her net take-home income. When you add your spouse as a co-owner of the loan, both the spouses’ income will be taken into account and this way, your loan eligibility will be increased and you can enable you a higher amount of loan as well a better home too.
Tax benefits for both spouses: To encourage more and more home buying, the Indian Government provides a tax exemption on home buying. A home loan borrower can claim a tax deduction of Rs.1.50 Lakh for principal repayment under the regulation of Section 80C and Rs. 2 Lakh for interest payment under the regulation of Section 24. Repayment of home loans can give tax benefits to both joint owners of a house. Joint owners of the property can each claim deduction separately up to the above-mentioned limits, as per their ownership share.
Lowers the Interest Rate: The minimum relaxation one can get in interest rate by adding the female partner is of 0.5%. It might seem like a tiny number here but the difference it can make in your total loan payable is unimaginable as when your loan amount is big and your tenure is long, the relaxation of 0.5% saves you a hefty amount.
Ease of accession: In case the property is jointly owned by both the spouses—as a joint owner or a joint tenant with equal shares in the property—it may ease up succession issues. In case of death of any one of the spouse, the stress and work involved to get the mutation done in the name of the surviving owner in reduced and it saves you charges involved for mutation.
At Pyramid Lifestyle, we provide homes that have been strategically planned, with top-class amenities and they have been evolved according to the changing times of the world. We offer appropriately built homes to accommodate the nuclear families and encourage us to enjoy the benefits of co-ownership in the projects that mark the city’s ascent onto the next level of lifestyle infrastructure. Visit www.pyramidlifestyle.com to know more about us and our work.