There has been a shift in trends regarding selling and purchasing houses in the real estate market. A 10-year decline has also been seen in the average age at which a person buys his first home (from 40-45 to 30-35). Owning a house is more than a matter of pride; it’s essential for financial security.
Joint ownership of property is another trend that is slowly gaining traction. A property can be co-owned by anyone without any rules. Houses are sometimes purchased jointly by couples. In addition to establishing equality between women and men, it also ensures long-term financial stability and benefits for the family. Many offices are purchased in partnerships to divide assets equally and to qualify for multiple loan benefits.
Read on to find out the pros and cons of joint property ownership.
Joint Ownership and Joint Property Rules
- Joint or co-ownership of property occurs when two or more people own a property together, and their ownership shares are not divided but unified.
- This can include joint property ownership with parents, husband and wife, business partners, etc.
- According to Section 44 of the Transfer of Property Act 1882, joint ownership of property is governed by specific laws.
- As joint property owners, everyone is entitled to share the benefits of common ownership, except those restricted from enjoying particular possession or use rights.
- Conflicts between joint property owners are the most common cause of problems with joint ownership.
- When co-owners of property are involved in such disputes, property lawyers can help resolve them.
Joint Registration of Property Benefits
Listed below are the benefits of joint name properties.
Home loans
Buying a property in a joint purchase requires all buyers to apply for a loan. A joint ownership can provide several home loan benefits. Banks assess loan applications based on the applicant’s net monthly income, among other factors. The net monthly income increases if there are multiple applicants. This would increase the eligible amount as well. Furthermore, the chances of loan sanctions increase when there are more applicants because bad debts tend to be minimised.
Tax Benefits
The principal and interest amounts of property owned jointly by two or more individuals can be deducted from their income taxes. Section 80C of the Income Tax Act allows co-applicants to take advantage of a benefit of ₹ 1.5 lakhs and ₹ 2 lakhs on principal and interest amount, respectively.
EMI Management
Loan repayment is more flexible while applying for a joint loan. EMIs can be structured according to the convenience of co-owners. A joint account can be opened, or their accounts can be continued. Applicants’ credit history will be impacted if one applicant delays repayment.
Property Transfers
Joint ownership of a flat in a housing society or any co-ownership property contract specifies the provisions of property transfers when entered into. The property can, therefore, be transferred easily to its respective inheritor in case of a sudden mishap.
The general trend is for couples to co-own a property, although no rules govern this. A non-earning member should be excluded from a joint property purchase, especially if a loan is planned. If the husband and wife jointly own a property, the wife would be liable for repayment in the case of the husband’s death.
Disadvantages of Joint Property Ownership
The advantages of owning a property as a joint tenant outweigh some of the disadvantages. Listed below are the disadvantages of joint property ownership in India.
Delays in Document Processing
The documentation process usually takes longer with many people involved in the home loan process. The process is repeated twice or three times, depending on the number of applicants. To prevent the bank’s rejection of the loan application, ensure that all the documents submitted are original.
Credit History Impact
It is important to note that in the event of any default payment, all applicants’ credit history will be tarnished. Joint home loans allow owners to decide whether one or both will repay the loan.
Own a Luxurious Home in Mumbai
In general, joint property ownership has more advantages than disadvantages. It is a good idea to share the title of the property. Be aware of the possible pitfalls to ensure a hassle-free and smooth purchase.
It is delightful and joyful to purchase one’s joint ownership luxurious home with their wife, parent, or sibling. This is why many young homebuyers now buy luxury property in Mumbai in joint ownership. Invest in Piramal Realty’s premium projects in Mumbai as a joint or individual owner.
Experience Piramal Projects’ e-tour today to find the dream home.
Disclaimer- This article is based on the information publicly available for general use as well as reference links mentioned herein. We do not claim any responsibility regarding the genuineness of the same. The information provided herein does not, and is not intended to, constitute legal advice; instead, it is for general informational purposes only. We expressly disclaim /disown any liability, which may arise due to any decision taken by any person/s basis the article hereof. Readers should obtain separate advice with respect to any particular information provided herein.
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