Buying a House
R Bajaj
(Querist) 10 August 2009
This query is : Resolved
Dear Sir,
I would like to know that is it better to buy a house with one's terminal benifits or seek an appropriate bank loan under following constraints:
Terminal Benifits 50 Lakhs
House cost 47 Lakhs
Individual in 30% tax bracket and will continue to be so for next 4 years.
Regards
Bajaj
Guest
(Expert) 10 August 2009
It is prudent to go for loan due to the following reasons :-
(i) Terminal benefits are exempted for IT upto certain limits (like gratuity, P.F.);
(ii) An individual who is left with few years of service, can utilise his current pay certificate to show his re-paying capacity; (After retirement, he may not get loan of required amount as of now);
(iii) Housing loan re-payment can be a major tax-saver element;
