Loan against property is one of the trending loans that is spreading in India. This is because it is the safest type of loan. In this type of loan, you will keep your property with the lender in the form of collateral. And then it totally depends upon the lender whether they can provide you a loan of the 90% value of the property or less than this with a low Loan against property interest rate.The loan is totally different from other loans and the best part is you can use the money anywhere there is nothing like restriction embedded in the money.
The loan against property is also eligible for tax exemptions. Let's discuss:
Section 37 (1)
Under this section you can avail loan against property without any hassle only the deduction will happen if you are using the amount for business purposes. If you are using the amount in business then you can claim the expenses and get the exemptions.
Section 24 (B)
Under this section, if you are a normal salaried employee then you can get a deduction of your tax on the mortgage loan. In this case also, if you need the loan to buy another property then you can have the advantages. Just remind these 2 points that the tax benefits will only apply for the interest paid and you need to show the usage of the amount borrowed by the bank to avail the tax benefits.
Personal use funds: No tax deduction: If you are utilizing the loan for the various personal activities like weddings, vacations then there will be no tax deduction occurs.
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