In the continuously feminising world, women are moving closer and closer to gain complete financial independence. The biggest step towards attaining the financial stronghold is house ownership. In order to encourage and empower women to buy their own homes, government and banks provide various benefits to female home buyers. While the government offers a concession on stamp duty, the banks proffer lower interests and longer tenures to women home loan borrowers.
Home Loan Benefits for Women
Alongside a reduction of 1% – 2% on stamp duty and registration charges, women home buyers enjoy additional benefits when they choose to go for a home loan for fulfilling their housing requirements:
Higher Loan Amount
Banks usually sanction a higher loan amount to female borrowers as compared to what is sanctioned to male borrowers. This is due to the fact that banks consider women to be more sincere towards debt repayments. Banks like SBI can even sanction a home loan of up to Rs. 3.5 Crores to a female applicant.
Lower Interest Rate
Banks offer a concession of about 0.05% – 0.10% on interest rates for home loans offered to women. Although this percentage may appear to be nothing yet they can lead to saving lakhs of money paid away as interest over the entire loan tenure. Here we have compared the interest rates offered to women and men by a few banks.
|SBI||8.75% – 9.85%||8.80% – 9.90%|
|HDFC Bank||8.90% – 10.10%||8.95% – 10.15%|
|Axis Bank||8.90% – 12.45%||8.95% – 12.50%|
|ICICI Bank||9.05% – 9.25%||9.10% – 9.30%|
|PNB||8.70% – 9.25%||8.75% – 9.30%|
|Bajaj Finserv||9.05% – 11.10%||9.10% – 11.15%|
|Citibank||8.75% – 10.70%||8.80% – 10.75%|
Pertaining to the sincerity in debt repayment of female borrowers, banks are more willing to sanction loans for a longer tenure. Some banks even agree to sanction a home loan extending for 30 years to women borrowers.
In order to encourage women home buyers, banks give a warm welcome to female applicants by giving out gift vouchers, gold coins, free vacation offers and privileged credit cards to the borrowers.
Women home loan borrowers enjoy income tax benefits at par with males under the various provisions of the income tax act. Women are eligible to enjoy annual tax deduction of up to Rs. 2 Lacs on interest payment under section 24, Rs. 1.5 Lacs under section 80C on principal repayment and the recently introduced additional tax benefit of up to Rs. 1.5 Lacs under section 80EEA on interest repayments exceeding the Rs. 2 Lacs mark.
Home Loan Eligibility for Women
A woman can apply and avail a home loan if she satisfies the following conditions:
In order to enjoy the various benefits available for female borrowers, a woman home buyer must necessarily be a resident of India. NRI women availing home loans in India do not qualify for these benefits.
At least 18 Years Old
For successfully receiving a home loan, a female applicant must be at least 18 years old at the time of availing the loan.
First Owner of Property
The woman should be the sole owner of the house for which the loan is to be availed, in case of single ownership. In case of joint ownership of the house, she should be the first co-owner of the property, that is, she should hold not less than 50% of the house ownership. Similarly, she should be the first co-borrower, in case the loan is availed jointly by all the co-owners.
In order to ensure the bank that the woman will be able to repay the debt, the woman borrower must have a stable source of income. The income inflows must be regular and viscous.
Good Credit Score
Credit score is a major deciding factor when it comes to borrowing and women are no exceptions. In order to enjoy lower interest rate and a bigger loan amount, a female borrower must ensure that she has a good credit score and clean debt history.
Things a Women Must Take Into Consideration While Taking a Home Loan
There are certain things that a woman must keep in mind before proceeding further with her loan application. These are:
Banks Resist Lending to Single Women
Banks usually do not provide home loans to single female applicant and require a co-applicant for sanctioning the loan. Therefore, women may not be able to enjoy these benefits on their own. Also, banks may ask for some additional security from a single woman.
Check Different Offers
Since banks come up with new schemes from time-to-time, targeted towards female borrowers, a woman must check various bank offers and go with the best one. For instance, SBI came up with a scheme, “SBI Her Ghar” designed specifically for women home buyers that provided for very less interest rates and flexible repayment options.
In order to promote women empowerment, banks offer various benefits to women borrowing home loans. These include lower interest rate, longer tenure, additional gifts and vouchers. There is however one condition for enjoying these benefits that a woman must be the primary home owner. The women also enjoy tax benefits on home loans, similar to men. However, certain banks resist from lending to single women and in such cases, a woman would need a co-applicant for availing the loan and enjoying the respective benefits.