What Are the Various Financing Options Available for Homebuyers?
Purchasing a home is a pivotal milestone that is often fraught with the challenge of how to get enough money for the same. In the Indian context, there are different ways one can finance his/her home acquisition, depending on preference. This article will, therefore, delve into these useful finance for home options in order to guide aspiring homeowners.
Godrej Capital
Godrej Capital is now a household name that any prospective homeowner can rely on when looking for their specific housing loan requirements. Some of the things which stand out in their offerings are listed below:
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Maximum Loan Amount: The borrower can ask for as much as ₹10 crore, thereby accommodating any size and type of property.
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Interest Rates: The rates range from 8.55% per annum, which means borrowers have easier options to obtain financing for homes through loans.
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Loan-to-Value (LTV) Ratio: It allows borrowers to get huge amounts of money in relation to what their houses cost.
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Flexible Tenure: This helps borrowers with managing EMIs better.
‘Home Loan for Women’ is another plan designed by Godrej Capital that is particularly aimed at enabling ladies to own homes without involving cumbersome documentation processes. These also support quick decision-making procedures regarding sanctions made within minutes of application time.
Government-Backed Housing Schemes
The government has introduced some programs to promote affordable housing in India and help seek finance for homes. Some of them are:
Pradhan Mantri Awas Yojana (PMAY)
The idea behind PMAY, which started off in 2015, was that it sought to provide every citizen of the country with cost-effective housing. The scheme offers lower interest rates to eligible individuals for housing loans, especially those who fall in the category of economically weaker sections (EWS), low-income groups (LIG), and medium-income groups (MIG). This way, it becomes less of a financial burden since beneficiaries have access to loan interest rates, which are subsidised by up to 6.5% for home loans.
Credit Linked Subsidy Scheme (CLSS)
CLSS was launched under the PMAY scheme to grant subsidies on interest payments to EWS, LIG, or MIG category homebuyers. Hence, beneficiaries get tax savings by reducing their loan amount.
Tax Benefits on Home Loans
The following are some of the tax deductions that can be claimed by home buyers in India on repayments made under a housing loan, thereby greatly reducing overall tax liability:
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Principal Repayment: Up to ₹1.5 lakh is deductible under section 80C of the Income Tax Act.
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Interest Payment: Up to ₹2 lakh deduction under Section 24(b).
A borrower could use a home loan tax saving calculator as it would enable them to estimate the potential savings they could make from taxes. Thus, they can help them in accurate financial planning. These tools can be found online for free, providing insight into how much one could save based on the loan details one has been given.
The Bottom Line
Therefore, there must be a comprehensive understanding of either private or government-driven schemes for Indians intending to secure finance for home-buying purposes. They include private lending entities like Godrej Capital, which has diverse types of mortgage products aimed at serving different classes of customers.
However, government interventions such as PMAY and CLSS also come in handy, especially among low-income earners who have dreamt of owning their own homes. Thus, by taking advantage of these opportunities and by knowing the tax benefits involved, future house owners can avoid making uninformed decisions concerning house ownership. Rather, they will be on their way towards success and being financially secure. Good luck borrowing!
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