A home loan can be burdensome, but it brings some financial benefits as well. While the most common benefit is tax exemption, there are other benefits to the borrower.
Here are the financial benefits you can enjoy from a Salt Lake City home loan:
Loans from Friends and Relatives Have Tax Benefits
If you got loans from friends and/or relatives, the interest you paid for the loans could be claimed as tax deductions. Just ask for an interest certificate, and make sure that the interest paid appears on the lenders’ tax returns.
Loan Charges Are Tax Deductible
As defined by law, interest includes all fees paid in relation to any type of loan. Therefore, as a home loan borrower, your processing fees, prepayment charges and other costs of your home loan are all tax deductible as interest.
Home Loan Interest Paid During Construction Can Provide Tax Relief
If you pay interest on your home loan while having your home constructed, you can claim tax deductions in 5 equal installments. But, you can claim it only upon receipt of the completion certificate.
Get Tax Benefit for a Missed EMI
You are eligible to claim tax benefits for the interest component of your home loan – even if you missed an EMI. There must be a copy of the certificate of interest issued by the lender that states the amount of loan and total interest the borrower must pay for a particular financial year.
Tax Breaks for Co-Borrowers and Co-Owners
As co-borrowers or co-owners, you’re not only joint property owners or jointly liable to pay the installments. You also enjoy the tax benefits from the home loan. You are entitled to tax benefits for both interest and principal if both your names appear in the property document.
These are only a few of the financial benefits you can enjoy from your home loan that will help you save some money.