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Benefits of Home Loan

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With the increasing property cost, it is a marvel to have your own home.  To realize this dream, it is important that we have our finances steady and consistent. Sometimes, when the savings are enough, you wish to spend it judiciously and they end up buying a property. To have the myopic view enlarged, home loans have come into the picture. Now, even if you have 20 % of the total cost of the property, you can own a home.  For this clarity, let us look at the benefits associated with Home Loans.

  1. Owning an Asset: Owning a Land or a property in our country is considered ‘Gold’. The reason why we equate it with gold is the consistent appreciation in the value of the property. So with an investment of about 20% of the total cost and 80% of the loan, you are creating a source of income for the rest of your life.  The rental income can be used as the interest to repay the loan. Hence, owning a home through home loan or construction loan to build a home are both a great way to invest for the long run.
  2. Do not keep all the eggs in one basket: It is advisable that even if you have enough money to buy a home, you must not invest all of that in buying a property. You must always use a home loan to keep yourself sane during an emergency. In situations when you need immediate finances, it is difficult to liquidate the property quickly, hence, you must invariably keep some money with you and opt or home loan to be in a safer situation.
  3. Tax Benefits: For better living standards the government of India has encouraged home loans. They have made the norms simple, wherein anyone who takes home loan can claim a deduction of about 1.5 lakh, under section 80 (C). At the same time, a deduction of up to 2 lakh can be availed on the interest.  These deductions can be availed after the home has been completely constructed, an under-construction cannot avail tax benefits.
  4. Improves Credit Score: When you start paying the EMI’s regularly and without fail, that is when you see you will begin to get more loan options. itis because taking a loan improves your creditworthiness.

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