Benefits aside, most of us still have to grapple with the fine print of a loan agreement.
A home loan helps you reduce your tax burden besides offering the pleasure of owning a house and living in it.
Increasing your loan eligibility
How to get the best rate for your loan
Can one get both exemption of HRA as well as deduction of interest payable on the home loan?
Funding your down payment requirement
In addition to above i would suggest some more way to save tax
BORROWERS INSURANCE ATTACHED TO HOME LOAN
1 some of the home loan company offer borrower insurance under which if borrower died no further payment of emi is taken from the survivors so it is a good insurance devise also. Suppose a borrower take loan of rs 10.00 lacs and after one year he died then rest of the loan woudl woudl be paid by the insurance companies. And survivors woudl be entitled for without encumberance home.
Maximum your tenure
Every assessee should take maximum tenure of loan. As such EMI would be less with .5% higher interest burden. He should deposit the differential [ EMI ON SHORT TENURE-EMI ON LOGEST TENURE ] with PPF. As the interest earned on PPF is same 8% but home loan interest is tax deductible so effective rate is less
For example if home loan interest rate is 8.5% and rate of Tax is 30% then effective rate comes to 8.5%-30% of 8.5% being tax saving
If the assess deposit the excess with PPF then after fifteen year he withdraw the money and repay his home loan he would be saving a lot
Further, with longest tenure his interest components will be more then Capital repayment comp
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