Lending organizations like banks and credit associations are trying to expand their loan portfolio by offering special schemes to women borrowers for a home loan. Some banks waive off or lower the processing fee for the loan and provide several discounts to lure women customers. All these schemes and offers have significantly encouraged women to invest in property and purchase their own homes.
Several leading banks like Allahabad Bank (public sector bank) offer lower interest rates on home
loans to women borrowers. Women customers can avail of an Allahabad Bank Home Loan for up to 20 years at an interest rate of 7.75% to 8.00% per annum, lower than the usual 8.15% ROI for general applicants. The maximum processing fee charged is usually Rs. 50,000, but for women, it is Rs. 25,000 only.
Here are some ways and schemes listed that the Non-Banking Financial Companies and Banks offer on Home Loans for women applicants -
Higher loan amount: Women borrowers can get home loans in the range of Rs. 30 Lakh to Rs. 3.5 crore, depending on the cost of the house or property they are looking to purchase. In addition to that, the lenders do not impose strict eligibility criteria, where
The age ranges between 21-60 years. 3
The net income is also Rs. 20,000 instead of Rs. 25,000.
Required work experience is two years instead of 3 years.
Lower interest rate to be paid: Most lenders consider women borrowers to be more reliable and less likely to default. They also provide low interest rates to encourage them to buy more assets like property and cars. The rates do not significantly differ from the current market rates. Still, there is a difference of around 0.05%-.0.1%, which might seem meager, but has a significant impact on the monthly EMIs and can make the repayment more convenient.
Longer tenures can be chosen: Usually, the maximum loan tenure is up to 25 years, and it can be extended to 30 years if you are a woman applicant. This helps to ease the burden of repaying higher rates in a shorter period. Also, there are no penalties imposed on part payments or foreclosure of the loan before the tenure ends.
Lower stamp duty: The stamp duty charges are 1%-2% lower for women borrowers than male borrowers. A decrease on stamp duty of 2% of the overall loan amount brings a significant reduction in the amount to be paid and is a considerable attraction for applicants.
Better tax benefits: As compared to the tax deduction of Rs. 1.5-2 Lakh on the principal amount for general borrowers, the women borrowers are qualified to claim tax abatement of up to Rs. 3.5 Lakh under Section 80C. The tax deduction on interest paid is the same for all borrowers, i.e., Rs. 2 Lakh. Male borrowers can avail themselves of these tax benefits if they are joint-owners of the home with their wives or another woman co-applicant.
Apart from the benefits mentioned above, women can also avail themselves of the PMAY (Pradhan Mantri Awas Yojna) Credit subsidy, which aims to provide the facility of "Housing for All" by 2022. In this scheme, the applicants are eligible for a grant of up to Rs. 2.7 Lakh on Home Loan Interest Rate.
Conclusion:
If more women apply for home loans, then the benefits can be enjoyed by them and their families. The lower interest rates and other subsidies can prove very fruitful in the long run and can help you manage your finances better.
Also read:- Your Guide to Finding a Best Home Loan Scheme
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