Home loan is one of the best backup that we have with us from financial companies, which help us in fulfilling our dreams which is not possible without loan. Especially when we build a rajkot property with high budget, it becomes impossible to manage the amount of money at once which we require and we fail to build our dream house.
Now, if you are going to save money for years and years to build your dream house, you would require wasting your lots of money on paying income tax to income tax department of India. But if you are luckily going under certain loans such as home loan you get relief from income tax department under certain terms and condition. There are many people who are taking home loan even though they don’t actually require, just for escaping from income tax department. We all actually waste lots of money on paying home loans, whereas same money we could be using for repaying the loan that we take, by claiming a relief of income tax department by taking home loan.
Home loans are very good for individual who are tired and fed up with income tax department. It is very simple logic where you just use the money which you pay for tax for getting house for your home in terms of E.M.I.
Tax Benefits of Home Loans:
There are 2 types of tax benefits for Home Loans:
1. Interest pay on Home Loan: According to the dictates of the income Tax act, you can claim the benefits of home loan under section 24 based on interest payment on Home Loan you pay to the bank.
2. Principal repayment of Home Loan: For this payment you can claim deductions under section 80 INR along with the other expenditures such as ELSS, insurance premium, other fees, etc. Deduction on stamp duty & registration fee can be claimed on the financial year, while the property was purchased.
For this financial year an additional deduction of Rs.1 lakh for interest is available under section 80EE. You can claim for such benefits of taking home loans from bank only upto 25,00,000 INR bank loans for the house worth it minimum 40,00,000 INR.
Apart from this we have extra benefit that does counts in our happiness. To gather all the money at once by saving might even take years and years of time to complete, even after which it may not be possible for you to get the money at once as we always have some situations in daily life. Where, we are bound to spend the money due to our fantasy mind or some other requirements.
While applying for home loan we should try to understand certain terms used in the agreement. It helps in saving money while paying the interest to the bank, important terms such as fixed rate of interest and floating rate of interest.
These are two different ways of repaying the home loans, with different rate of interest. There are various terms which we must try to understand to enjoy the complete benefits of house loan.