With home loans, you can purchase your dream home without creating a hole in your pocket. All you need to do is, apply for a home loan and submit the documents. Once approved, the loan amount is disbursed and you have to repay the amount each month in the form of EMI. However, the process can be a bit tricky if you fail to meet the home loan eligibility.
Thankfully, a joint loan can help you. Applying for a home loan with a co-applicant can increase the chances of your home loan approval. It can also increase the home loan amount you can avail.
But, do you know who can be your co-applicant for a home loan
Who can be a Co-Applicant?
You can take a home loan with your spouse, brother and parents. However, there are certain conditions to that –
Husband and Wife
A married couple can take a joint home loan. The borrower need not be the owner of the house as the property can be in the name of any one of them.
Siblings
An applicant can take a joint loan with his brother. But currently, they should be staying together and should continue to do so in the new house. Sister-sisters or a sister-brother duo cannot be co-applicants.
Parent and Son
A father can take a joint home loan with his only son. In such a case, the income of both the co-applicants is taken into account. The property can be in the name of both, as the son would be the undisputed legal heir. On the other hand, if the father has more than one son, he can take a joint loan with his son(s), but he should not be the primary owner of the property. He cannot be the borrower but only a co-applicant of the loan.
Parent and Daughter
A father and unmarried daughter can take a joint loan. However, the property should be in the name of the daughter and only her income should be taken into consideration. This same rule applies if an unmarried daughter takes a joint loan with her mother.
Things to Keep in Mind While Taking a Joint Home Loan
- The co-owners should be co-applicants of the home loan.
- All the co-applicants are liable for the loan repayment. He/she is responsible to repay the loan in case the borrower defaults or dies.
- While the borrower must meet the home loan eligibility criteria, it is also necessary that the co-applicant is eligible for the loan too.
- All the co-applicants can choose to repay the loan from a joint account or individual accounts. Similarly, the loan can be repaid through a cheque or National Clearing System.
Restrictions on Having Co-Applicants
- You cannot take a joint home loan with a friend or relative with whom you have no blood relation.
- Brother-sister and sister-sister duo cannot be co-applicants in a home loan.
- A minor cannot be a co-applicant with his/her parents, as he/she cannot enter into a contract legally.
Close family members can be your home loan co-applicants, provided they have a stable income and fulfil certain conditions. However, one must be careful while choosing a co-applicant or even when being one, as both are responsible for repayment, and any default on anyone’s part can cause problems.
