Improving Odds Of Home Loan Eligibility With Co-borrowers
No matter where you wish to live, owning a home is a goal for many individuals, couples, and families. It provides a sense of comfort, stability and creates a personal place that is a retreat and pride. Wondering if you wnat to buy an apartment or a villa? Choose any one according to your preference, but you must have a home loan eligibility that helps you co-borrow the money.
However, with the cost of homes rising, it can be challenging to afford to buy a home without having the assistance of a co-borrower. Opting to add a co-borrower to the loan provides a simple solution and one that works for many people.
It makes sense that married couples can become co-borrowers for a home. When this is utilized, the income of both working spouses can be used to qualify for the loan and to show the ability to make the home loan EMIs (Equated Monthly Installments). The same is also true for qualifying family members but knowing what the banks will approve as a co-borrower can sometimes be more than a bit complicated.
The Relatives You Can Count On
Close, qualifying family members may also be as co-borrowers on a home loan. This can include your parents or adult sons, providing both groups are currently making an income . They can contribute to the repayment of the loan.
Retired parents without an income will not be co-borrowers, nor will unmarried daughters as a general rule. This is due to the uncertain nature of how long the daughter will be able to contribute should she marry. The exception to this would be if the son or daughter became the primary property owner and the parents then became the co-borrowers. This may be an ideal solution, and it is one that the family can determine as in their best interest.
In most cases, brothers and sisters are not eligible to be considered co-borrowers. While brothers and sisters may be very close, there is always the uncertainty, from the lender’s perspective.
Partners in businesses can sometimes be co-borrowers. The lender will take a look at the professional relationships and, on that assessment, make the determination. This is relatively rare, but it certainly is considerable to increase the home loan eligibility.
Family friends, unmarried couples, very elderly parents or relatives or roommates are not eligible to become co-borrowers. The lack of stability in the relationship is seen as a risk factor that is too high for the lender.
It will be important to consider tax implications for co-borrowers. Not all co-borrowers are co-owners, with tax benefits equal to the ratio of the actual amount of service of the loan. This is also a complex issue and having a full understanding of the lending process will help you make you increase the home loan eligibility.