Advantages and disadvantages to know before submitting a joint mortgage application to ICICI Bank

Key parameters taken into account when evaluating your Real estate loan ICICI Application includes applicant’s credit score, income, employment profile and stability, age and existing monthly obligations.

The level of importance of these factors tends to vary from lender to lender and on a case-by-case basis, depending primarily on the credit risk matrix chosen by the lender. Incorrect documentation and / or not being eligible for any of these defined eligibility criteria may result in the rejection of your loan application. Therefore, to process or avoid rejection of your home loan application, hiring a co-applicant for a joint loan can increase your overall loan eligibility as well as your chances of approval.

Let’s understand the main aspects, advantages and disadvantages of a solidarity mortgage by submitting a request for Real estate loan ICICI:

Essential aspects to keep in mind when applying for a joint mortgage loan

In addition to the prerequisite of mandatory condominium co-owners to become co-borrowers of the home loan, other circumstances in which a co-applicant’s close may increase overall loan eligibility and increase the chances of overall approval for them. primary borrowers applying Real estate loan ICICI are principal applicant’s monthly debts exceeding 50-60% of income, a risky job profile or employer profile, an inadequate credit rating, a large loan amount, a principal borrower near or already retired , etc.

Thus, people facing difficulties to avail themselves of mortgage loans on their own, in particular at lower rates offered in the form of ICICI mortgage interest rate, can go find a co-applicant to have the joint mortgage loan approved.

In addition, when you hire a co-applicant for your Real estate loan ICICI, prefer that the co-applicant be a salaried member of your family, as this reduces the credit risk for the lender since the co-applicant also becomes responsible for the timely repayment of the loan.

Advantages of closing with a co-applicant to benefit from a solidarity mortgage

Increase overall eligibility-

While considering moving forward with the decision to tie up a co-applicant, particularly a woman, in order to seek lower ICICI mortgage interest rate, prefer to have their own source of income coupled with a good credit rating as well as a satisfactory repayment capacity, as this would improve the Real estate loan ICICI chances of eligibility and approval. Since the co-applicant becomes responsible for repaying the home loan, this also reduces the overall credit risk for the lender, thus increasing the chances of getting the loan approved.

On a related note, since people nearing retirement may have difficulty getting a loan approved, they can bring in a younger co-applicant to help them get home loan approval as well as mortgage loan approval. ICICI mortgage interest rate and a longer term.

More tax benefits-

Principal applicants as well as co-applicants can independently benefit from the tax advantages available according to their contribution to the repayment of interest and the main component of the mortgage. A tax deduction is available for a limit of up to Rs 2 lakh when repaying the home loan of the self-employed property interest component under section 24b and up to Rs 1.5 lakh during each exercise due to the repayment of the principal component under section 80C can be claimed by both the principal applicant and the co-applicant for a home loan. Therefore, using a co-applicant for your home loan can result in higher overall tax benefits. But note that a condition is attached to the use of this tax advantage, in which the co-borrower can only benefit from the available tax advantages if he is also a co-owner of the property concerned.

Lower rates for female candidates-

Many mortgage lenders typically go ahead and offer interest rate reductions to female co-applicants. A concession of 5 bps (0.05%) is offered to them vis-à-vis the rates applicable to other borrowers. Thus, bringing a female co-applicant into a loop turns out to be a good way to get concessional rates. Lower rates would in turn help reduce the overall interest cost of the Real estate loan ICICI.

In addition to the possibility of benefiting from a joint mortgage loan for borrowers who have difficulty obtaining a mortgage, there are two other ways to increase eligibility. First, they can pay a larger down payment or margin contribution rather than contributing the minimum 10-25% of the cost of ownership out of their own pocket. Second, they can opt for a longer tenure, as this implies lower EMI expenses and, therefore, lower EMI to income ratio. Since both of these ways help reduce credit risk for the lender, those who are less likely to get a home loan may increase their home loan approval reach by trying to make a larger down payment and / or to choose a longer repayment term. Higher overall mortgage eligibility coupled with a good credit profile can also help better profit ICICI mortgage interest rate, thereby reducing overall interest charges.

Disadvantages

Rigid eligibility criteria

The co-borrower of Real estate loan ICICI Usually can only come from the list of relatives specified by the lender. Different mortgage lenders or banks have their own set of relationship terms that they accept for joint mortgage loan applications. Lenders generally tend to only allow spouses or blood relatives of a principal applicant to become co-applicants. Some lenders may also have a tendency to hesitate or reject the loan of joint home loans to cases like unmarried partners or siblings. For condominium home loans taken out for condominium units, lenders or banks typically require all co-owners of the home to become co-borrowers of the home loan.

Possible rejection if the co-borrower has no or a bad credit rating

Always keep in mind that when evaluating your joint home loan application, the primary borrower as well as the co-applicants’ credit rating, income, age, debt-to-income ratio, etc. are taken into account. If the credit score of your co-applicants is on the lower side, your joint home loan application may be rejected, as lenders would be reluctant to lend to those who have not demonstrated disciplined credit repayment behavior. which led to a bad credit rating.

The lender for home loans tends to approve joint applications and even offer ICICI mortgage interest rates when they are satisfied with the repayment capacity of both the primary borrower and the co-applicant. In addition, the rejection of your mortgage application, for whatever reason, will lead to a deterioration in your credit score. Sometimes lenders may decide to set higher rates for you instead of rejecting your joint home loan in such cases.

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