Benefits of Home Loans in India
- Lower Interest Rates: Home loans have the lowest interest rates (8.5%-9.5%) compared to other loans.
- Tax Savings: Save up to ₹3.5 lakh annually under Sections 80C and 24(b).
- Long Tenure: Repayment period up to 30 years makes EMI affordable.
- Asset Creation: Building equity while paying EMI instead of rent.
Home Loan Tax Benefits (Tax Year 2026-27)
Section 80C: Deduction up to ₹1,50,000 on principal repayment (Old Regime only).
Section 24(b): Deduction up to ₹2,00,000 on interest paid for self-occupied property
(no limit for let-out property) — Old Regime only.
Section 80EEA: Additional ₹1,50,000 deduction on interest for first-time home buyers
(property value up to ₹45 lakh) — Old Regime only.
Note: New regime is the default from Tax Year 2026-27. You must actively choose the Old Regime to claim these deductions.
Home Loan Eligibility Criteria
- Age: 21-65 years (salaried), 21-70 years (self-employed)
- Income: Minimum ₹25,000/month (varies by city and bank)
- Credit Score: Minimum 650, preferably 750+
- Employment: Minimum 2 years work experience (salaried), 3 years business vintage (self-employed)
- EMI to Income Ratio: Should not exceed 50% of monthly income