Adding a co-applicant for a Loan Against Property adds support to the income of the primary borrower. Thereby, the application strength increases due to an improvement in eligibility. Needless to say, having a co-applicant for a Mortgage Loan makes borrowers eligible for a larger volume of loan. This amount can, in turn, be utilized for various purposes like planning a wedding, or a child’s higher education.
Loan Against Property
Nevertheless, a stronger application increases borrowers’ negotiability. Therefore, prospects can avail their loans at lower Loan Against Property Interest Rates. Mainly, if the co-applicant is a woman, some lenders consider a discounted rate of interest.

Lenders offer such loan against property with various added facilities like Flexi-Hybrid feature, and easy balance transfer facility. Further, loans with such institutions have a very short disbursal turnaround time of 72 hours. Addition of a co-applicant provides borrowers with the required leverage to avail these conveniences on a better footing.


There are certain factors that borrowers must consider before adding a co-applicant to a loan.

> Credit Scores

Credit ratings of prospective borrowers are indispensable factors for consideration, be it any loan at all. In case a borrower decides to opt for a joint loan, individual credit scores of both applicants must be higher than 750. Financially strong applicants can together enjoy lower loan against property interest rates.

> Income

A co-applicant must be financially strong with a regular flow of income. This is all the more important, because:

1. Higher income volume counts for more reliable borrowers, hence, their negotiability for loan against property interest rates increases. Also, together, both applicants can apply for a larger amount of credit.

2. In cases of non-repayment by the primary borrower, the co-applicant can shoulder the responsibility of repaying the loan solely.

In addition to this, income proof of co-applicants serves as a significant loan against property documents required.

> Eligibility for Benefits of Taxation

Prospective co-applicants must also be eligible for taxation benefits. Taxation benefits are available separately for each applicant in cases of joint application. Each borrower can avail tax deductions of upto Rs. 1.5 lakhs on principal amount and Rs. 2 lakhs on interest amount.

Thus, the combined tax benefits are far higher than single applications. However, the benefit available to each applicant is proportionate to their contribution for principal and interest repayment. Therefore, both applicants can pre-plan how much tax benefit each of them would wish to gain access to, and thereby base their loan repayment proportions on it.

> Other Benefits

Generally, immediate family members can vouch for being co-applicants. Co-owners of a particular property automatically become joint applicants for a loan against property. As mentioned before, strong co-applicants increase the overall credibility of the borrowers. Hence not only can they collectively avail lower loan against property interest rates, but they can also avail a home at a lesser cost due to the synergic effect of combined tax benefits.

> Necessary Compliance Requirements:

Without a doubt, Loan Against Property Documents Required must be submitted for all applicants. Proper documentation smoothens the processing of applications. After all, these documents are the basis on which fund houses provide loans.

Of course, with lenders opting for such loans has become much more favorable for prospects. These lenders come with diverse avenues like EMI financing on varied products and a variety of other financial services.

Author's Bio: 

Arwind Sharma is a financial advisor with an experience of more than 7 years. He has worked for topmost financial firms in India and has been a visiting faculty at many reputed institutes in India. Currently based in Gurgaon, Arwind Sharma is a name to reckon with when it comes to financial management for big brands. A post-graduate in business economics, he is an alumni of Princeton University, USA. During his free time, Arwind teaches children from marginalised sections of society and also work on his blog.