Applying for a home loan is not an easy task. Banks or lenders will look at certain important factors of the applicant, (like income, credit history, loan amount, eligibility, etc) before approving the loan. In some cases, the applicant may not be able to take a loan single-handedly. In such cases, the borrower can choose the option of having a co-applicant to get the loan without rejection.

A co-applicant is a person who takes the equal responsibility of repaying the loan amount along with the borrower. The co-applicant need not be a co-owner of the property. But they become liable and share an equal responsibility in the loan repayment and legal disputes.

Who can be a co-applicant?

Not everyone can be a co- applicant. Banks and Housing Finance companies have allowed only certain relations who can be co-applicants.

Father and son: In this case, both can jointly own the property if the father has only one son. If there are more than one, he cannot become the owner but can be a co-applicant.

  • Father/Mother and Unmarried daughter: Unmarried daughter can apply for a joint home loan with parents.

  • Husband and wife: For joint home loan husband wife can also apply together.

  • Brothers: Brothers can take home loan together provided they are staying together and also continue in the new property.

Unaccepted co-applicants

1. Father/Mother and Married Daughter

2. Brother-sister

3. Sister-sister joint home loan is not allowed

What are the benefits of having co-applicant?

  • Chances of getting lower interest rate and quick approval

  • The borrower is entitled to have tax benefits. The co-applicant can avail for tax benefits only if he is the co-owner of the property.

  • The co-applicants income will supplement the borrower’s eligibility to get a better loan and house.