You can include a Home Loan Co-applicant to your Home Loan Application to increase your loan amount eligibility. Therefore, a co-applicant applies along with you on the loan application, and his/her income can be added to calculate your loan eligibility.
Benefits of having a Home Loan Co-Applicant
- Increased Loan Eligibility
- Tax Benefits for both the Applicant and Co-Applicant
Who can become a Home Loan Co-Applicant?
Banks and Housing Finance Companies permit only a few selected relations to be included as Co-Applicants. Any co-owner must be co-applicant to the loan compulsorily, and minors cannot be co-applicants to a loan. Most banks consider the following relations to be co-applicants:
Brother – Brother / Mother – Son / Father-Son / Husband – Wife
Husband and Wife
You can involve your spouse as a co-applicant and hold his/her income to determine 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, he should not be the main owner of the property. His children should succeed in the property jointly and cause an inheritance dispute in case of his death.
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 have the property at all.
Brother and Brother
Banks will get two brothers as co-applicants if they are visiting together and do so in the new property.
Father and Unmarried Daughter
Banks allow an unmarried daughter to join jointly with her father. However, the banks mandate that the property is only in the daughter’s name, and the father’s income should not be considered as this may cause problems later when the applicant gets married.
Mother and Unmarried Daughter
This is treated 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