Got a home loan query?

Have a query regarding your home loan? Maybe we can help.

Drop us a line and our expert, Harsh Roongta, will answer it.

• Got a question for Harsh Roongta? Please write to us at getahead@rediff.co.in with the subject line as: Question for Harsh Roongta.

Can you please tell me if the (interest + principal) amount that you pay towards your home loan in a year is dependant on the amount of loan that the bank has actually disbursed to the builder for that year (or) is the amount repaid towards the actual loan amount sanctioned regardless of the amount disbursed?

Loan amount sanctioned is 20 lakh. However as per the builder's plan the bank only needs to pay 10 lacs (depending on the extent of construction completed) in the first year from start of construction.

So would the EMI * 12 that I would pay in the first year be on the 20 lacs or would it be on the 10 lacs? Kindly clarify. 

                                                                                                                                                                         Venkat

The (interest + principal) amount that you pay towards your home loan in a year is dependant on the amount of loan that the bank has actually disbursed. When there is only partial disbursement, it is usual for the lender to charge only the interest amount (called Pre-EMI) till the entire disbursement is made.

Some lenders may start of f the EMI on each disbursement made. Obviously, in both the cases, (whether you are paying EMI or Pre-EMI), the payment amount is dependant only on the actual disbursement and on the sanctioned loan amount.  

 Whether you are paying the Pre-EMI or the EMI, you can get tax deduction benefits for the home loan for an under-construction property only from the financial year in which the construction is completed.

I have seen an article @ http://www.rediff.com/getahead/2005/apr/14home.htm. This was for the financial year 2005-2006.

I have a similar query, so I am mailing you. Hope you can help me by clarifying my doubt. My query is on the regulation for 2007-2008.

I have taken a property (Flat on loan from HDFC) and got it registered in Dec 2006. Since January 2007, I have been paying EMI for the complete loan amount. The construction of the flat was completed by 31st August, 2007. I am letting out this property from Nov 1st, 2007.

For the period between 1st Sep and 31st Oct, two months, I made some renovations to enhance the flat. (During this period I had no rental income).

Now I know that I am eligible for a rebate on Principal repayment till Rs 1, 00,000. By 31st March 2007, the interest I would have paid would be Rs 4,40,000. The rental value I would have received would be Rs 1, 00,000. Will I be eligible to claim rebate on interest for Rs 3,40,000? If not so, how will it be calculated? Can you kindly reply back?

                                                                                                                                                                          Rajeev

Since you have rented the flat, there is no cap on the interest which is tax deductible under section 24 (b). Hence, you will be able to claim 100 per cent of the amount of interest payable for the year ended March 31, 2007 (irrespective of whether it was payable for the period during which it was under-construction, renovation or rented out). You will also be eligible for a 30 per cent standard deduction on your rental amount. Please consult your tax advisor. Broadly speaking, the calculation will be as under,

Rental income: Rs 1, 00, 000
Less: Municipal taxes (say): Rs 2, 000 = Rs 98, 000                                                           

30 per cent standard deduction (30% of Rs 98, 000): Rs 29,400
Interest: Rs 4,40,000*
*Total assuming everything was payable in respect to this financial year only: Rs 4,69,400

Loss from house property: Rs 3, 71, 400

The loss is adjustable against your salary or bonus income as any other income during the year.

I'm Likith from Hyderabad. I'm telling you what I know regarding my home loan, actually my father had got sanctioned Rs 23 lakh home loan from Canara Bank during March 2006, they have transferred Rs 10 lakh to earlier bank where we had taken loan. later, they have released only Rs 4 lakh for construction, after that they have taken Rs 1 lakh for EMIs in the month of March-2007 but they have not given any letter or statement regarding our loan amount, the exact EMIs and the amount they are charging for either total Rs 23 lakh or Rs 14 lakh. Recently they have called up my father and asking Rs 2 lakh to be paid for Rs 23 lakh or bring any vouchers for Rs 2 lakh construction where we can collect from your loan amount sanctioned.

I think the amount goes up to Rs 23 lakh from Rs 14 lakh in the same phase and our need is not full filled they have not released the remaining amount. they are converting the remaining sanctioned amount to collected as EMIs. I can say one thing clearly to you that they have not sent any post letter or any statement to us. So, please kindly help me.

                                                                                                                                                            P.L.S.chaitanya

It is the responsibility of the bank to give you a detailed statement of your loan account. You should file an official complaint on the bank's official website and get a copy of your acknowledgement to the concerned branch.

Mention the complaint clearly that you will be forced to complain to the Banking Ombudsman if the loan statement is not given immediately. If your issue is not resolved, please put the complaint with the Banking Ombudsman on www.bankingombudsman.rbi.org.in  

Could you please help in understanding the percent of Interest on housing loan that can be availed by an applicant and co-applicant? Do we need to compulsorily declare 50% every year?

We paid Rs 220K towards interest on housing loan for year 2007-08. Can the applicant declare 70% and co-applicant 30%?

I believe applicant and co-applicant can show loss from house property u/s 24 up to Rs 150K each (self-occupied).

Last year being the first year of paying the Interest on housing loan we declared 50% each.

                                                                                                                                                                     Anuradha

If you both are co-owners to the property and co-borrowers to the joint home loan, you both can claim tax deduction benefits on the loan up to the extent of your respective shares in the loan.  

As both of you are co-owners, both will be eligible for the attendant tax benefits in the proportion of your share in the loan.

Technically, you can change the share in the flat and hence your share in the loan and also change the tax benefits available to each of you. Please document the necessary changes so that you do not have any problems in getting your tax benefits. However, any change in the ownership pattern is likely to have stamp duty implications and hence-you should proceed with caution on the change in ownership pattern.