What is the loan against property tax benefits?
A Loan Against Property is an excellent option for funding urgent business or housing needs. It is a secured mortgage loan that allows you to mortgage your property and borrow funds, depending on your eligibility and requirements.
One of the main advantages of a Loan Against Property is its flexibility in usage. The funds can be used for a variety of purposes, including home renovations, property remodeling, business expenses, or even debt consolidation.
Can I get tax benefits on a loan against property?
A loan against property is sanctioned against a property used as collateral with a lender. The lender decides the loan amount depending on the property value. Financial institutions usually provide up to 70% of the property value as the loan amount.
The tax benefits that you can avail on the loan against property depends on the end-use of the loan. Read on to find out what section you can avail it under.
- Under Section 37 (i)
Under Section 37 of the Income Tax Act, you can get tax benefits on the interest paid for your loan against property
- Under Section 24 (b)
Under Section 24, you can get a loan against property tax benefits on the interest paid on your loan if the funds are used for financing your new home. The maximum benefit that you can avail of under this section is Rs. 2 lakh.
Additional read: How to avail tax benefits on your loan against property?
Some loan against property features that you can enjoy apart from tax benefits include:
High financing amount
Get a high-value mortgage loan to meet your multiple requirements
Extended repayment tenor
Repayment tenor ranges up to 15 years for easy repayment
Nominal documents requirement
The documents required for a loan against property are minimal. You can also avail of our doorstep facility to submit the documents
Convenient eligibility criteria
you can easily fulfil the loan against property eligibility criteria. If you are salaried, you must be between 25 years to 85 years (including non-financial property owners) or less at the time of loan maturity, whereas if you are self-employed, your age must be between 25 years to 85 years (18 years for non-financial property owners). You must also have income stability and good credit history.
Quick processing
Loans against property are processed within 72 hours* of applying.
Know how to apply for a loan against property today and find the loan amount disbursed to your account within 3 days* after processing.
Frequently asked questions
Tax deductions are generally applicable if the loan is used for business or housing purposes. Personal expenses may not qualify for tax benefits under the Income Tax Act, 1961.
Yes, tax benefits can be claimed if the loan is taken against a commercial property, especially if the loan is used for business-related purposes like expansion or renovation.
No, GST benefits cannot be claimed on a loan against property. The loan is not subject to GST as it is a financial transaction rather than the purchase of goods or services.
Using a loan against property for medical expenses does not directly offer tax exemptions. However, certain medical expenses may be eligible for tax deductions under Income Tax Act.
To maximise tax benefits, ensure the loan is used for business purposes or home renovations. You can claim interest deductions under Section 24(b) and principal repayment under Section 80C.
