Basically, home loans and land loans will have several similarities. A borrower should have a clear understanding of home loans and land loans.
A home loan is taken to purchase a new villa or constructed one.
A housing loan assists to buy constructed on are under construction. A land loan is used to buy a loan for the construction. Similarly, borrowers cannot get a land loan to buy an unfinished home or ready to move property.
Buying land can be used for multiple purposes commercial/residential use. To get a land loan, should meet the following criteria:
- Land should not be in village
- Land should not be in any industrial area
- Land should not be designed for any agricultural uses
- The land should not be have any commercial construction on it
Borrowers can claim a tax deduction on principal as well as interest repayment on the home loans. Land loans cannot come under any tax benefits. The only tax benefits apply only for the amount taken to build the construction on it.
Eligibility requirements for a land loan?
The eligibility requirements for a land loan and home loans are similar. Let see some similar requirements:
- Credit score
- Age of the applicant
- Monthly income
- Job stability
- Work experience
- Any existing loans