- Women are increasingly turning to home ownership due to societal changes.
- Home financiers offer attractive terms to women.
- A woman as co-borrower can increase the loan amount resulting in a larger house and more tax benefits.
- For first time home buyers, PMAY scheme offers a credit subsidy but having a woman co-owner is compulsory.
- All these factors mean India is entering an era where more women will have a house to their name.
Women are increasingly taking their rightful place as equals in Indian society. As women in the country become financially independent, they are also weighing in on big decisions of life like purchasing a home for their families. This has translated into home loan providers creating special schemes and opportunities for women to own their homes and extending some unique home loan benefits for ladies.
Home loan benefits for women in India
Home loan benefits for ladies are multi-fold. Women are recognising this and are opting to take a home loan. Here are some benefits:
1. Lower interest rates: Many home loan institutions provide lower interest rates for women applicants. A lower rate makes a great impact on Equated Monthly Instalments (EMIs) and provides significant savings over the tenure of the loan.
2. Women benefit as co-borrowers: Women have the opportunity to apply as co-borrowers with their spouses. Combined income of the couple can mean a higher loan eligibility and more flexibility in choosing a suitable home for their family. Furthermore, like their male partners, women too enjoy a tax deduction on the home loan repayments with the maximum deduction allowed in principal as well as the interest at Rs. 1.5 lakh and Rs. 2 lakh respectively1.
|Home loan tax benefits for Individuals||Home loan tax benefit for Couples*|
|Principal under Sec 80 C||Rs. 1,50,000||Rs. 3,00,000|
|Interest under Section 24||Rs. 2,00,000||Rs. 4,00,000|
|Total Deductible||Rs. 3,50,000||Rs. 7,00,000|
*The actual amount of tax benefit enjoyed by each co-applicant is in proportion to their contribution in repayment of principal and interest, subject to the limits mentioned above.
3. Lower stamp duty: The government is encouraging home ownership for ladies as well. Home loan benefits for female include lower stamp duty charges by 1-2% by many state governments. A woman can thus save Rs. 80,000-Rs. 1,60,000 on a property worth Rs. 80 lakh.
4. PMAY is a game changer: The Pradhan Mantri Awas Yojana (PMAY) makes female co-ownership mandatory for female head of the family2. In the Economically Weaker Section (EWS) and Low Income Group (LIG) segments of the PMAY scheme, preference is extended to widows as well as single women3.
Why women should take a home loan?
Women should consider taking a home loan because of a number of factors:
Favoured applicants: Data analytics of many lending institutions indicates that loan default among women applicants is lower. Thus, a woman’s chances of being approved for a home loan are higher.
Specialised schemes : Lenders are encouraging women to move towards becoming home owners and are launching schemes as well as offering lower interest rates targeted at women.
Right time to buy Women should consider buying a home as this is the right time to buy a home in India:
1. CLSS: First time home buyers can avail subsidy under PMAY up to Rs. 2.67 lakh, irrespective of gender4.
2. Attractive prices: The real estate sector today offers quality properties at attractive prices, which makes it the right time to consider buying a home.
3. Regulatory transparency: The Real Estate Regulation and Development Act (RERA) has ushered in an era of increased regulatory transparency in Indian real estate.
Women today have a clear path to home ownership and with supportive financial institutions and government on their side, they can work their way to their dream home with ease.