Benefits on loan to first-time home buyers

By
2987

  • Share on
First time homebuyers

Home loan comes to the rescue of first-time homebuyers looking to book a property with limited funds for down payment. Availing a home loan also has additional benefits. Read on to know more about the benefits provided to first-time home buyers.

In the last few months, the real estate sector has gone through a significant transformation. The sector has observed many reforms, including RERA (Real Estate Regulatory Authority), GST, demonetisation among others. The rapid economic growth and higher availability of funds have made it comfortable for the common man to close a home buying purchase decision. Several benefits are there for you to avail while buying a home on a mortgage. While anyone who purchases a house with a loan can claim benefits on repayment of the loan, there are additional tax benefits for the first-time homebuyers.

Deduction of Interest - Various sections provide relief to first-time homebuyers on interest rates.

Section 80C: Under this section, the tax benefit can be claimed up to an amount of Rs 1.5 lakh on the repayment of the principal amount of the loan.

Section 24: The section states that tax benefits up to Rs 2 lakh can be claimed on repayment of interest on your housing loan. This provision is only applicable for a self-occupied property. If you are renting out your property, then there is no maximum limit on the tax benefit amount. Hence, you can claim the entire interest amount as a tax benefit. You can do this even if the amount exceeds Rs 2 lakh.

Tax Benefit on Home Loans: This section states that if you represent a first-time buyer then you can claim an extra Rs 50,000 as a tax benefit on the interest repayment.

Deduction on GST – According to an ICICI Bank spokesperson, “the government has cut GST rate from 12% to 8%, for houses purchased using the credit-linked subsidy scheme (CLSS) under Pradhan Mantri Awas Yojna.” The homebuyer should have a family income of up to Rs 18 lakh per annum to be eligible for an additional benefit extending to Rs 2.7 lakh. This provision is applicable while purchasing an apartment or house up to 150 sq mtrs under the Credit-Linked Subsidy Scheme.

Deduction on Subsidy Slabs - Under the extension of income slabs for offering a subsidy to first-time homebuyers, the government has announced two new slabs in the subsidy, to spur the real estate market and meet housing for all by 2022. The new slabs will apply to loans having a tenure of up to 20 years against the limit of 15 years.

Income Slab (in INR)

Interest Subsidy

Principal Amount (in INR)

12 lakh

4%

9 Lakh

18 Lakh

3%

12 lakh

 

 National Housing Bank (NHB) and HUDCO represent the nodal agencies to carry out the various subsidy plans. Under the plan for the low-income group, the government has subsidised around 18,000 first-time homebuyers, at a cost of Rs 310 crore. 

 

 

  • Share on
Rate it 1 Star2 Stars3 Stars4 Stars5 Stars (8 votes, average: 5.00 out of 5)
Loading...Loading...
  • Post a New Comment

Usage of 99acres.com to upload content which enables targeting by religion/community/caste/race is prohibited. Please report inappropriate content by writing to us at report abuse
Home Legal Sitemap Send Feedback
Back To Top