It is not mandatory to have a co-applicant when you avail of home loans in India. However, if you have a co-applicant you can get some additional benefits. Since two individuals are sharing the responsibility of repaying the debt, lenders can be assured of timely repayment. Furthermore, having a co-applicant can help you get favourable interest rates. Not only that, but your eligibility also increases if you have a co-applicant. To obtain a home loan the first thing that a borrower should do is fill in the home loan application.
You can either visit your nearest bank or NBFC to fill out the application or you can fill out an online home loan application form. The second option can save you some time. Next, the lender will go through your application and will disburse the loan amount, which will be transferred to your bank account. It can take up to 5 working days for the disbursal process of home loans. In this article, we will see how a co-applicant impacts the home loan application process. But, before that let’s understand the dynamics of co-applicants for home loans.
Who is a co-applicant?
A co-applicant is a person with whom you, the borrower, would like to share the responsibility of repaying the loan. Co-applicants are regarded as secondary to the principal applicants in many cases. For instance, if the primary borrower passes away, the co-applicant becomes liable for the loan amount.
Who can be a co-applicant?
The requirements for becoming a co-applicant may differ from one lender to another. Although most of the lenders follow a standard procedure which are:
- The most-favoured co-applicant combination for a home loan is a married couple. Lenders take into account the income of both husband and wife while determining home loan eligibility and consent.
- For a home loan, a single daughter could be a co-applicant with a single parent or both parents.
- A father and a son also become co-applicants for home loans. However, the final decision rests upon the lender.
Benefits of having a co-applicant while applying for a home loan
If you wish to get a home loan with a co-applicant you can get some advantages which are as follows:
- Having a co-applicant can help you share the responsibility of EMIs and other responsibilities. This way, you will be free from the burden of a massive loan amount.
- If you add a co-applicant to your home loan application you will be able to improve your qualifying conditions for a larger loan amount.
- Even with a poor credit score, you can apply for a home loan with a co-applicant. In that case, the co-applicant should have an improved credit score.
- Co-applicants can also avail of tax benefits if they are co-property owners.
How to apply for a home loan?
Applying for a home loan with co-applicants is not new. People have been doing it for years for quick loan disbursal. And now, the process has become even more simple with online portals. Here is how you can apply for home loans.
- Visit the official website of the lender.
- Go to the Home Loans option
- Fill in the online application form
- Give necessary details like name, address, etc.
- Also, mention your relationship with the co-applicant
- Attach whatever documents the lender asks for
- Click on the Submit button
Alternatively, you can visit the nearest bank branch or NBFC, to apply for a home loan with a co-applicant.
Features of home loan
Home loan features vary from one lender to another. But, there are a few common features of home loans. These are:
Purchase of properties
Home loans are the best option to avail of if you want to purchase a flat, bungalow, or a row house.
Expert guidance
If you take a home loan from a reputable lender you can receive technical and expert counselling. This will help you make an informed decision regarding purchasing a property.
Integrated networks
With home loans, you can buy your dream home. Banks and NFCs offer integrated networks for home loans anywhere in India.
Minimal documentation
In the case of home loans, you have to pledge the property as collateral. Thus, there is not much documentation necessary to obtain a home loan.
Repayment tenure
The maximum tenure for a home loan depends on the retirement age of the borrower. Most banks and NBFCs ask people to repay the loan amount within 30 years, which is the maximum time limit.
Interest rates
The interest rates for home loans keep changing, depending on your credit history, income, eligibility criteria, etc. You can seek home loans for interest rates starting at 6.40% p.a. Also, the lenders charge a processing 0.25% processing fee for the loan amount.
Go through all the options available and get a home loan that provides the best deal and features. Applying for a home loan with a co-applicant is a great liability. However, it also offers many perks. If you have difficulty calculating the EMI share, use a home loan eligibility calculator for that matter.
