Joint home loan & family home loan

Hi Sir,

We have bought a residential bungalow worth Rs. 41 lacs, and we are three joint holders of the property (Me, my wife and my father). We have taken home loan of Rs.32.8 lacs (80% of actual price) from bank. I and my wife are working as salaried employees of an IT firm and we are repaying the loan, where loan installment per month is Rs.27000 (16000 and 11000 paid by me and my wife respectively).

Now, my queries are as follows:

1. Is it possible that I can take the loan of Rs.6 lac from my mother, to pay rest of the bungalow price? If yes, then what are the tax implications for me & my wife as well as my mother & what are the legal documents required for the same?

2. Can I & my wife both avail the tax exemption on home loan interest (for loan from bank as well as from my mother)? If yes, then what shall be ratio to avail exemption?

Ans. Dear Friend, First let me understand from ur query.

A. Property Cost = 41L
B. No. of owners = 3 (U, ur wife & ur father)
C. Amount pitch in by U & ur wife thru bank loan = 32.8L
D. Additional amount pitch in by both of u = 6L from ur mother as home loan
E. Balance amount = 41 - (32.8+6) = 2.2L

Here I assume, that this 2.2L Rs. r coming from ur father only. Even if both of u do have a part in this 2.2L amt. also plz. do inform me for the same.

As per my assumption share of both of u in the house = 38.8L Rs.

Share in Bank loan EMI = 16000 & 11000 & the same ratio both of u may continue for ur mother`s loan.

Now here comes the answer for ur queries.

1. Yes it`s possible for both of u to take home loan of additional 6L Rs. for the same house from ur mother. The interest paid for this loan to ur mother, `ll be available for Tax benefit for both of u in the ratio as stated above. The interest received by ur mother from both of u `ll be her taxable income & if her total income from all other sources is more than the zero tax limit for her (1.9L Rs. or 2.4L Rs, depending upon her age, as the case may be), she w`d have to pay Tax on it. For this loan, u should prepare a loan agreement between ur mother & both of U.

2. Yes both of u can avail tax benefit on the interest & principal repmt. of bank loan & interest only for mother`s loan. But from ur query it seems that the house in Question `ll be self occupied, hence u & ur wife can`t claim more than 1.5L Rs. each, (1.5+1.5 = 3L) interest on combine loan.

For detailed info u may mail me directly to my mail id.

ashalanshu@gmail. com

thanks

Ashal ...