Transfer of Property as gift
anand
(Querist) 10 February 2010
This query is : Resolved
Dear Friends,
I have taken a home loan and paying the EMI. But the property for which i have taken home loan is in my mother's name and she is co-applicant in the loan application.
THe issue is, under income tax, the person having the ownership only can take the deduction under 80C of IT Act.
So now i want to transfer the house in my name.
So can anyone suggest me, how can i transfer the house in my name in a very best manner in terms of cost and convinience?
or can any one suggest me any other way to get the tax exemption?
Raj Kumar Makkad
(Expert) 10 February 2010
The house is already mortgaged with the bank and untill and unless no objection on behalf of the bank is received, such house cannot be transferred in your name as per law. You can obtain certificate from bank to the effect that you have taken house loan being co-applicant and you can also obtain a certificate from your mother supported with an affidavit to the effect that the house belongs practically to you and she has also made her irrevocable will in his name. It is possible that ITO may grant tax benefit as required in the light of all those documents.
anand
(Querist) 10 February 2010
Thanks for the information Sir.
Till now i have not taken loan. iam planning for it. it will be sanctioned by next week.
Can u throw some light on which certificate i should take from my mother.
and what i have to do.
A V Vishal
(Expert) 10 February 2010
I very much doubt that the loan will be sanctioned since you are only the applicant but not co-owner, I very much doubt that the legal counsel will give a favourable report unless you are included as an owner in the sale deed, if the deed is already executed you have no option but execute another sale deed in your name for the purpose of loan and which in turn will attract capital gains to your mother, a gift deed cannot be executed since there a gift itself is without a consideration, however if it is with a consideration then you are liable to stamp duty on the amount of payment made to your mother.
anand
(Querist) 10 February 2010
Thanks for the Information Sir,
Can i enter into an agreement with my mother stating that i will become the coowner for the property without executing a sale deed or gift deed?
If i become the co-owner, i will take the entire loan in my name and can claim full tax exemption under 80C and 24?.
Do the agreement need to be registered with the registrar?
Do i have to get the name changed with the muncipal authorities as co-owner?
A V Vishal
(Expert) 10 February 2010
Not possible, bankers will look out for their safety in case of default in payment of the loan and further an agreement also is of no use even if it is registered since it lacks legal enforceability further on basis of the agreement the muncipality will not mutate your name as a co-owner.
Guest
(Expert) 10 February 2010
Mr.Anand, the possible way in your present situation is to get a Settlement Deed registered in your name by your mother and apply for a bank loan. Once the Settlement Deed is registered, you will become the owner of the property. But I don't know which State you belong to. In TN, the stamp duty is only Rs.12,500/- for registering a Settlement Deed by your mother to yourself. But an agreement of any nomenclature between you and your mother WILL NOT certainly give you any ownership rights to the property.
Raj Kumar Makkad
(Expert) 10 February 2010
You have asked only hypothetical question without any base so why to waste time????
anand
(Querist) 11 February 2010
Dear Rajkumar,
what made you think its a hypothetical question. If u r unable to answer then dont reply.
Thanks
