You can include a Co-applicant to your Home Loan Application in order to increase your loan amount eligibility. A co-applicant, therefore, applies along with you on the loan application and his/her income can be added to calculate your loan eligibility.
Benefits of having a Co-Applicant
- Increased Loan Eligibility
- Tax Benefits for both the Applicant and Co-Applicant
Who can become a Co-Applicant to a Home Loan?
Banks and Housing Finance Companies permit only a few selected relations to be included as Co-Applicants. Any co-owner has to compulsorily be a co-applicant to the loan and minors cannot be co-applicants to a loan. Most banks consider the following relations to be co-applicants:
Brother – Brother / Father – Son / Mother – Son / Husband – Wife
Husband and Wife
You can include your spouse as a co-applicant and include his/her income to calculate home loan eligibility
Father and Son
If the borrower is the only son, he can apply jointly with his father and both their incomes will be considered. The property needs to be in their joint names.
In case a person has two or more sons and wishes to apply with one of them or both, then he should not be the main owner of the property. This is because, in case of his death, his children should succeed to the property jointly and may therefore cause an inheritance dispute. In such a case, the father can only be a co-applicant and his income can be considered for the loan. He may be the co-owner or not own the property at all.
Brother and Brother
Banks will take two brothers as co-applicants if they are staying together and will continue to do so in the new property as well.
Father and Unmarried Daughter
Banks permit an unmarried daughter to apply jointly with her father. However the banks mandate that the property be only in the name of the daughter and the father’s income should not be considered as this may cause problems later when the applicant get married.
Mother and Unmarried Daughter
This is treated exactly the same way as Mother and Unmarried Daughter
Who cannot be a co-applicant?
Lenders do not entertain the following as co-applicants:
- Sister and Brother
- Married Daughter and Father / Mother
- Sister and Sister
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