The joint personal loans are loans jointly acquired by the two people. Generally, married couples take this type of loan. The major advantage of joint personal loan is that you get to qualify to take the higher loan which could not be possible if you would have taken a personal loan. The people undertaking joint loan become jointly liable for the loan repayment. Their liability is jointly as well as several. So the question that who spends the money doesn’t arise. The joint liability terms mean that if one partner doesn’t pay off the money the other partner becomes personally liable to pay the money. Also, a person saves more on the joint loan than on individual loan. Approval of application for loan increases when a person jointly takes a loan. If you don’t want the other person to spend money of the loan without your permission then you can put this clause in your contract. A joint personal loan repayment generally varies with one year to 7 years. However, it can extend as per the terms of the contract.
Benefits of joint personal loan
- Tax benefit can be claimed by the joint owners of the loan. Both the partners can show the amount of loan in their income and expense statement and avail deduction.
- Joint application loan gets instant clearance. You can receive the money quickly if you apply for the joint loan.
- You can compensate your credit history with your partner’s credit report card. If you have a bad credit report and your partner’s credit rating is high, there’s a high chance that you will still get the loan.
- When you take loan individually, you can get only certain amount as a credit. Generally, the individual loan amount is lower than amount sanctioned for a joint personal loan. Hence, if you need a hefty sum of money apply for the loan jointly. `
Things to consider before applying for the loan
Make sure that partner with whom you choose to have a joint personal loan is trustworthy. This is the most important aspect of the joint loan as if your partner doesn’t pay the loan amount; you will become personally liable for repaying the whole amount. Even if your joint partner dies, you still have to pay the whole amount of the loan. Choose the partner judiciously. Apart from a spouse, you can also apply for a joint loan with your parents and siblings. Get a report card of your credit history before applying for the loan. A good credit report will make the loan sanction easy.