NRI means Non-Resident Indian, as we all know. A person will also be regarded as an NRI if, during the previous fiscal year, he spent less than 182 days in India. The rules of FEMA also apply to an NRI who purchases real estate in India. Indeed, a large number of Indians live and work overseas. Some non-resident Indians (NRIs) might want to buy real estate in India as an investment or just to buy a second house for themselves. The price difference between buying a home in India and overseas is one justification. A home in India might be less expensive than one where the NRI currently resides.
Even so, the non-resident Indian may find it challenging to cover the full cost of the home they wish to buy in India. In this case, the individual can apply for an NRI home loan to cover the shortfall in funds. Some individuals believe that NRIs cannot buy a home in India, but this is untrue. Lending to NRIs is a very common practice among banks and financial institutions.
NRI Home Loan Tax Benefits: Anyone of Indian descent who purchases real estate in India, whether they are a resident or an NRI, is eligible for several tax advantages. You can claim tax exemptions in India with NRI home loans under several sections of the Income Tax Act of India, 1961. These include Section 80 C’s 150,000 INR deduction and Section 24(b)’s 200,000 INR deduction.
You may be eligible for the following tax benefits on the home loan if your house in India is vacant and you have a mortgage loan for it:
Interest component: You are eligible for a reduction of up to Rs. 2 lakhs.
main component: You are eligible for a main component deduction of up to Rs. 1.5 lakh.
If the house has been leased out, you can deduct all of the interest paid from your home loan’s tax liability.
Given that the credit requires little paperwork, you can receive approval more quickly. There are flexible choices for repaying the loan and one is free to choose between interest rates that are set and those that are floating. Additionally, a part-prepayment option is offered with no fees. Using an online NRI home loan calculator, you can determine your estimated home loan sum and monthly payments. If you pay off your debt early, there are no prepayment penalties.
Given that this property’s worth is expected to rise over time, it can be a tremendous asset for your kids. Now is the ideal moment to obtain a home loan and safeguard your future amid the skyrocketing real estate prices.
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