Claims for Deduction
Although the tax benefits are available in the ratio of the share of each individual in the home loan but to avoid future hassles tax experts suggest that the share of the home loan and other such details should be put on the stamp paper in the beginning only. Moreover every borrower has to provide a copy of the borrower certificate to claim their respective tax relief. Two separate copies of such certificates along with a copy of the agreement signed between the two co-borrowers would be needed to file for tax benefits. There are chances that either of the borrowers misses on the tax rebate, so in that case one can claim it as a refund at the time of filing tax returns.
The repayment process for joint home loan is similar to the process for a normal home loan but it should ensured that two cheques are not drawn for clearing the same equated monthly installment (EMI). Any housing finance company does not accept two cheques for a single EMI. So to make the payment, co-borrowers can use a joint account against which the cheques can be drawn. Another way of repayment could be that the co-borrowers share the number of EMIs between them such as N number of cheques can be issued by one borrower and the balance by the other.
There is yet another mode of servicing the EMI - one borrower can pay off all the installments and thereafter claim refund from the other borrower for his share. However the experts do not suggest picking for this option as it gets unmanageable for both the borrowers and the HFC.