Are you a young woman who wants to buy your dream home but has not been able to take the initiative, fearing high-interest rates? If yes, then you might be interested to know that there are many benefits to home loan schemes for women home loan borrowers in India. In this blog, we will explore the process, rates, interests, and benefits of home loan for women in India and how you can easily avail them.
Benefits of Home Loan Scheme for Ladies in India
Beyond the advantageous interest rates, women availing home loans in India enjoy additional benefits, including:
- Tax Deductions
You can claim deductions on both the interest and principal repayments under Section 24 and Section 80C of the Income Tax Act. The max you can get is Rs. 2 lakh for interest and Rs. 1.5 lakh for principal each financial year – not bad, right?
In cases of joint ownership with a man, both can claim deductions separately based on ownership and repayment shares.
As a wife, a woman can become a co-applicant in the home loan application with her husband. This will also help them both in claiming a tax deduction individually under Section 80C and Section 24 of the Income Tax Act 1961.
Oh, and for those looking to buy their first home, there’s an extra treat. You can also get a deduction under Section 80EE and 80EEA. But remember, that one’s exclusively for first-time house buyers.
- PMAY Subsidy
Women borrowers falling under the Economically Weaker Section- EWS, LIG- Low Income Group, or Middle Income Group (MIG) can avail of home loan subsidy for ladies under the Pradhan Mantri Awas Yojana (PMAY).
Homes provided under PMAY-U come with must-haves like toilets, water supply, electricity, and kitchens.
The cool part?
The initiative aims to empower women by making sure the houses are either owned by female members or held jointly.
And it gets even better.
The Pradhan Mantri Awas Yojana gives special consideration to people like differently-abled individuals, senior citizens, SCs, STs, OBCs, minorities, single women, transgender individuals, and others who need a little extra support.
Now, if you fall under the EWS- Economically Weaker Section/ LIG- Low Income Group (LIG), MIG- I- Middle Income Group, or Middle Income Group (MIG)-II, and you’re on the hunt for a housing loan to build, buy, or give a fresh look to your place, guess what?
You qualify for an interest home loan subsidy.
The home loan subsidy for women comes in three spects – 6.5%, 4%, and 3% for loan amounts up to Rs. 6 Lakh, Rs. 9 Lakh, & Rs. 12 Lakh, respectively.
Sweet, right?
- Reduced Stamp Duty
Stamp duty is another factor that adds to the cost of the property.
To encourage women to own property, different states in India offer a reduction of 1% to 2% in stamp duty.
This again makes for considerable savings.
Government Assistance for Housewives
While there isn’t any fixed subsidy on home loan for ladies in India, housewives can still secure loans by becoming co-borrowers alongside their husbands or other earning family members.
The co-borrowers income is factored into loan eligibility and repayment capacity, making them eligible for lower interest rates, tax deductions, and PMAY subsidies.
Government Schemes For Housewife
- Pradhan Mantri Awas Yojana (PMAY):
- PMAY is a scheme that offers home loan subsidy for females on interest to women belonging to economically weaker sections (EWS), lower-income groups (LIG), or middle-income groups (MIG). To avail of the subsidy, female co-ownership is mandatory.
- Working Women Hostels:
- This scheme provides safe and affordable accommodation for working women, especially those who are single, widowed, divorced, or separated. Additionally, the scheme offers daycare facilities for the children of working women.
- Mahila E-haat:
- Mahila E-haat is an initiative providing an online platform for women entrepreneurs and self-help groups to showcase and sell their products and services.
The scheme also offers training, mentoring, and financial assistance to women entrepreneurs.
- Nari Shakti Puruskars:
- This scheme recognises and honours the achievements and contributions of women in various fields, such as social work, education, health, sports, art, culture, etc.
Not only this, cash awards and certificates are provided to the awardees.
- Swadhar Greh:
- Swadhar Greh is a scheme offering temporary shelter, food, clothing, counselling, and rehabilitation to women in distress, including victims of domestic violence, trafficking, or other forms of abuse.
Under this government scheme for housewife, legal aid, medical care, education, and vocational training are also provided.
- Support to Training and Employment Programme for Women (STEP):
- STEP is a scheme focused on providing skill development and employment opportunities to women in traditional and non-traditional sectors such as agriculture, horticulture, handicrafts, tailoring, beauty care, etc.
The scheme also offers stipends, raw materials, marketing support, and credit linkages.
Why Women Should Take a Home Loan
Homeownership is not only a dream but also a necessity for many women in India. Whether it is for personal security, financial independence, or social empowerment, having a place that you can call your home can have many benefits for women.
However, we all know that buying a home is not an easy task, especially for women who face various challenges in terms of funds or high rates in the real estate market. That is why taking a home loan can be a smart and feasible option for women who want to achieve their personal dreams and fulfil secret independent goals in life.
Types of Loans for Housewives
Housewives can explore various loan options for personal, business, or education purposes, provided they meet the lender’s eligibility criteria. Potential avenues include:
- Secured Loans: Housewives can pledge assets like gold, property, or fixed deposits as collateral for a secured loan. The loan terms and interest rates will depend on the value of the collateral and the lender’s policy.
- Joint Loans: Another home loan option for women is to secure a joint loan with a husband or another earning family member. In this case, the co-applicant’s income and credit score will influence eligibility and repayment capacity.
- Loan Against Rental Income: For housewives earning rental income from a property they own, applying for a loan against this income is a viable option. The terms of the loan will be determined by the rental income and the lender’s policy.
- NBFCs or MFIs: Housewives can explore loans from non-banking financial companies (NBFCs) or microfinance institutions (MFIs) that specifically cater to women. This is especially beneficial for those who are self-employed or operate small businesses.
The Process to Apply for a Home Loan For Women
Securing a home loan for ladies in India follows a process that is quite similar to any other loan application.
Here’s a step-by-step guide:
- Check Eligibility: Begin by ensuring you meet the lender’s eligibility criteria, covering aspects such as age, income, credit score, and property value.
You can also utilise online loan tools like eligibility calculators and EMI calculators for a quick assessment.
- Compare and Select a Lender: You must thoroughly compare interest rates, processing fees, loan tenure, and other features offered by different lenders.
- Submit Application and Documents: Complete the application form and submit the necessary documents, including identity proof, address proof, income proof, and property documents. Choose between online and offline application modes based on the lender’s preference.
- Verification and Approval: The lender will scrutinise your documents, assess the property, and conduct a credit appraisal to determine your loan amount and interest rate. Upon approval, you’ll receive a sanction letter.
- Agreement Signing and Loan Disbursement: Sign the loan agreement and pay stamp duty and registration charges. The lender will disburse the loan amount either to your account or directly to the seller, based on the chosen disbursement mode.
Conclusion
If you are a woman who wants to buy your own home, you now know that there are many benefits of home loan for women in India. You can enjoy lower interest rates, tax deductions, PMAY subsidies, reduced stamp duty, and government assistance for housewives.
To apply for a home loan, you must check your eligibility compare and select the right lender.
Ready to take the first step towards owning your own home?
FAQs| Home Loan Benefits for Women
Some banks and Housing Finance Companies (HFCs) do offer a discount on the interest rate specifically for women borrowers. This discount typically ranges from 0.05% to 0.1%, leading to substantial savings over the loan tenure.
As long as a female meets the eligibility criteria set by the lender, she can qualify for a home loan in India. Eligibility criteria typically include factors like age, income, credit score, employment status, and residential status.
There are specific schemes tailored for women seeking home loans. One notable example is the Pradhan Mantri Awas Yojana (PMAY), which offers interest subsidies to women falling under economically weaker sections (EWS), lower-income groups (LIG), or middle-income groups (MIG).
Yes, female co-ownership is mandatory under PMAY because interest subsidy can be availed only if an adult female is named as a co-owner.
Source- https://pmaymis.gov.in/, https://pmay-urban.gov.in/
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Disclaimer: Investments in the securities market are subject to market risks; read all the related documents carefully before investing.