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Can I Apply for a Home Loan Second Time?

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  • Highlights

  • Can I Apply for a Home Loan Second Time?

  • How to Apply for Second Home Loan?

  • Quick Tips to Learn Before Seeking a Second Home Loan

  • Documents Required to Fulfil the 2nd Home Loan Eligibility

  • Tax Benefits a Second Home Loan Can Fetch You

After securing a home loan to purchase or refurbish a home or property, you may still desire a second home. To do this, a second home loan is needed. The approval for your second home loan is dependent on several important factors, one of the most important one being – your repayment capacity.

While it is possible to seek a second home loan, it great depends on your credit score and current financial obligations as well.

The process of applying for a second home loan is not too different from that of your first. However, it is recommended that you complete repaying the first home loan. Completing payment on time shows that you are trustworthy, and this often influences lenders to strongly consider your second home loan bid. There are exceptions but taking a second home loan while the first home loan exists limits the amount that you can receive.

One of the advantages of a second home loan is that it comes with certain tax benefits. These are different from the ones enjoyed during the first home loan. You can secure a second home so long as you fulfil the 2nd home loan eligibility. 

The Bajaj Housing Finance Home Loan Eligibility Calculator and our Home Loan EMI Calculator are viable tools to help you decide if taking out a second home loan with make financial sense for you. Based on the information you provide, it projects your EMI forecast which can help you gauge your repayment capacity.

Whether the second home loan is for a new bigger home for the family or a home that you will lease to prospective tenants, you need to know how to apply for it. Read on to learn more about the requirements for a second home loan, the tax benefits, and the home loan eligibility

How to Apply for Second Home Loan

You can apply for a second home loan through the lender who approved your first home loan application or with another lender like Bajaj Housing Finance. Whichever way you choose to go, every applicant must do their due diligence and find out the best loan terms the market is offering at present and how they can be the best fit for it.

Quick Tips to Learn Before Seeking a Second Home Loan

These quick tips below will help you get a better shot at securing your second home loan.

  • Ensure that the property or home’s location is duly considered. Pay a few visits to the neighbourhood and meet the neighbours too. Whether it is for tax benefits, or lease purposes, or a vacation home, make sure your decision is well informed. If the property or home is for leasing, then see that the property fulfils the needs of prospective tenants.
  • Take stock of your current EMI and financial obligations and chalk out your repayment capacity keeping in mind all your expenses.
  • Also, note that the guidelines for a second home loan differ from the ones of the first. Occasionally, your lender may request a greater downpayment than from before. Make sure that you’ve considered all the possible costs you may have to bear.

Documents Required to Fulfil the 2nd Home Loan Eligibility

  • Proof of identity
  • Proof of residence
  • Proof of income. This means your latest salary slips or up to 6 months’ worth of bank statements
  • Income tax return, audited balance sheet, and profit and loss account report for up to 3 years
  • Property documents
  • A filled second home loan application form

Tax Benefits a Second Home Loan Can Fetch You

You can expect the tax benefits on a second home loan to be equal to the first. You receive tax deductions up to Rs.1.5 lakh and Rs.2 lakh for the principal amount and interest repayments. This is backed by Sections 80C and 24 of India’s Income Tax Act. Meanwhile, if the property your new home loan will purchase is to be leased, then there is no upper limit for tax deductions on interest payments only. 

Now that you know how to apply for a second home loan, approach Bajaj Housing Finance for attractive offers on a second home loan at friendly interest rates.

Check through our available home loan options today to see the one that fits your second home needs best.

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