Disclaimer: This Article is for information purpose only. The views expressed in this Article do not necessarily constitute the views of Kotak Mahindra Bank Ltd. (“Bank”) or its employees. Bank make no warranty of any kind with respect to the completeness or accuracy of the material and articles contained in this Newsletter. The information contained in this Article is sourced from empaneled external experts for the benefit of the customers and it does not constitute legal advice from Kotak. Kotak, its directors, employees and the contributors shall not be responsible or liable for any damage or loss resulting from or arising due to reliance on or use of any information contained herein.
25 NOVEMBER, 2021
Lately, women are proactively contributing in almost every field and making a name for themselves. However, finance is still a sector that lacks women’s participation to a large extent. Thankfully, the government aims to bridge this gap by offering various incentives to women. Real estate is no exception. Women borrowers enjoy extra benefits in purchasing a house if she is the primary home loan borrower. While availing a home loan with a co-borrower can help women get a high-value loan and even lower interest rates, they can get additional benefits if they are the primary borrowers. Here are a few ways by which women can benefit from being the primary home loan borrower.
A recent report indicates that women are better borrowers than men and are more likely to repay their dues timely without default. Therefore, as they are at lower credit risk than men, lenders usually approve their home loans quicker. Also, they have a better chance of getting a high loan amount due to their creditworthiness and credibility.
As a primary borrower, women also hold a chance to get a lower home loan interest rate from the lender. It is due to their lower credit risk and concessional interest rates offered by lenders for women borrowers. Often women borrowers are offered 5-15 basis points lower interest rates than those given to men. Though this difference may seem insignificant, the overall interest outgo by this concession can substantially reduce the EMI and cost of borrowing.
The government also provides benefits and incentives to women home loan borrowers through the various housing loan schemes. Under the Prime Minister’s flagship housing program Pradhan Mantri Awas Yojana, women are prioritized over men for subsidies. To avail benefits under this scheme, a woman must be the owner of the house. Under this scheme, the beneficiary can get a subsidy of up to Rs 2.67 lakhs. Through this scheme, the government aims at providing affordable houses to the general masses while encouraging women to invest in house properties.
To further help women buy homes, many states offer concessional rates on stamp duty for women. Many state governments charge lower stamp duty on the sale of the property if the house is registered in the name of the woman. Usually, the stamp duty rate is 1-2 % lower for women, helping them save on interest outgo and loan EMIs. For instance, in Delhi, the stamp duty for men and women is 6% and 4%, respectively.
Along with being an investment, a house property can be a source of financial security for women. Moreover, if she avails a joint home loan, all the applicants can benefit from the concessions offered to women home loan borrowers. So, what are you waiting for? Check your home loan eligibility and apply for a home loan, today.
You have already rated this article