Home loans: Discrimination or Advantages That Women Borrower Face

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women rights

Women have become equal to their male counterparts in today’s time as more and more women are opting for a stable career and building a name for themselves. Today’s women have become financially independent and can afford to buy a home in their names. However, when it comes to applying for home loans, women, sometimes have an edge over male borrowers. To promote women empowerment, lenders and also the Government give additional benefits to women borrowers when they apply for home loans. These benefits include the following –

Lower interest rates

This is a common practice in many leading banks and non-banking financial companies (NBFCs). Women borrowers are allowed lower interest rates than male borrowers. The interest rate varies by 0.05% to 0.10% across different lenders. This practice brings down the loan cost for women borrowers and motivates more women to avail a home loan in their name.

Lower stamp duty charges

Stamp duty is applied to the value of the property and the rate varies across different states of India. Whatever be the applicable stamp duty rate for home loan borrowers, women are charged a lower rate compared to men. For women, the stamp duty rate is lower by 1% or 2%. This reduction in stamp duty charges helps women save on the property cost. Since the value of the property is in lakhs, a difference of 1% or 2% in the stamp duty rates also reduces the property cost by tens of thousands.

Benefits of tax

It is common knowledge that home loans give borrowers tax benefits. The same also holds true for women borrowers. They can claim tax deductions under Section 80C and Section 24 (b) for home loan principal and interest payments respectively. Moreover, if the woman is a co-applicant or a co-borrower in a home loan, then also she can claim these tax deductions on her taxable income.

Ease of borrowing

Women are considered to be more trustworthy when it comes to repayment of home loans taken by them. As such, lenders often allow home loans to women borrowers on easy terms because they believe that their loans would be repaid in time. Though the eligibility criteria remain the same for women borrowers, the lending terms are relaxed and approval on the home loan is allowed quickly.

These are some common benefits which women home loan borrowers have. Moreover, there might also be special home loan schemes designed especially for women offered by banks and the Indian Government. Despite these benefits, there is one discrimination which women borrowers often face when they apply for home loans. In case of women borrowers, lenders often insist on co-applicants or co-borrowers for the loan. Women borrowers are required to add an earning individual as a co-applicant for their home loan. This gives lenders security because it is often believed that women might not have a stable career to pay for the loan themselves. However, this practice is not universal. Women need to check with different lenders to understand their lending practices.

Additional Reading: – Factors that can affect your home loan EMI

So, women face both advantages and discrimination when they apply for home loans. However, the discrimination they face is slowly being disposed of as women of today are increasingly becoming financially savvy.

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