Top Reasons Why You Should Opt for a Home Loan if you are Self Employed

May 26, 2023 by Rustomjee
Buyer's Guide
Benefits of Opting for a Home Loan as a Self-Employed Person
May 26, 2023 by Rustomjee

Being self-employed offers a chance for independence, the power to shape your own destiny, and the freedom to pursue your passions. But the greatest benefit of all: the flexibility to set your own hours and work from the comfort of home, allowing you to craft a productive and beneficial work-life balance.

The immense potential of self-employment can provide you with the power to determine your financial fate and maximize your earnings. Despite the possibility of obstacles, you cannot be discouraged while exploring your prospects of securing a home loan. By developing a prudent financial strategy and providing the required documentation, you can avail of mortgages specifically created to suit your individual needs – the road towards autonomy, financial stability, and achieving personal and professional aspirations.

A home loan is an intelligent decision. Even if it appears intimidating for the self-employed to apply for a home loan, it comes with a myriad of advantages – and below we will explore the reasons why you should consider it. Read on to learn more!

Flexible Eligibility Criteria

One of the key benefits for self-employed home loan individuals is the flexibility in eligibility criteria. Unlike traditional loans that primarily consider salary-based income, home loan providers assess the income and financial stability of self-employed borrowers differently. They take into account factors such as business profits, cash flows, and other sources of income, allowing self-employed individuals to qualify for a housing loan based on their overall financial profile.

Tax Benefits

Home loans offer attractive tax benefits for self-employed individuals. Under Section 24(b) of the Income Tax Act, you can claim deductions on the interest paid towards your housing

loan. Additionally, Section 80C allows you to avail tax benefits on the principal repayment of the home loan. These tax benefits significantly reduce your tax liability, making home loans an excellent financial move for self-employed individuals.

Opportunity to Build Assets

Home loans are an ideal option to invest in a physical asset like your own home. With a home loan, you can buy the property without depleting your liquidity, as opposed to paying for it outright with a sizable amount of your resources. Your home equity builds up over time as you make payments, ultimately raising the worth of your financial portfolio. You are making a sensible financial decision by choosing a house loan in addition to an investment.

Low Housing Loan Interest Rates

Home loans often come with lower interest rates than other types of loans, making them a great and affordable option for self-employed individuals. Taking advantage of these comparatively lower interest rates can result in major savings over time. To get the best deal available, it is important to compare interest rates from different lenders and choose the best one that suits you.

Easier Home Loan Application Process

For self-employed individuals, obtaining a home loan has become far simpler in recent times. Loan providers have begun to provide more flexible paperwork rules, as well as allowing for the completion of home loan applications online. This has made the process of acquiring a home loan far more stress-free for the self-employed. Furthermore, some lenders have developed tailored lending products for this purpose, catering to the specialised fiscal situation faced by those who are self-employed.

Opting for a home loan is a wise decision for self-employed individuals desiring to become homeowners. It features flexible eligibility requirements, advantageous tax benefits, the possibility of creating assets, notably low housing loan interest rates, and a simplified application process. If you are self-employed and in the process of purchasing a home, consider obtaining a home loan and making your dream home a reality.