Dear Swapnil, I plan to take a new Home loan of about 13 lacs for tenure of 6 years with a fixed interest rate of 14%. I have few queries related to tax benefits related to Home loans. I visited http://www.indiahousing.com/tax-rebate-on-home-loans.html where it is mentioned that one can avail maximum tax benefits upto Rs. 2.5 lacs i.e. Rs. 1 lac [Sec 80C] Rs. 1.5 lacs [Sec 24b]). I have few queries related to the second option i.e. Interest paid on the home loan.
With this portfolio, I have to pay in all Rs 19 lacs from my pocket i.e. Rs 6 lacs goes as an interest to the bank. I heard that Banks normally squeeze out maximum interest during the initial period of your tenure. Is this correct?
How do I calculate "Interest paid on the home loan" per year? I assume it like: Interest Amount (per annum) = Total Interest on Loan / Tenure i.e. 6 lacs / 6 yrs = Rs. 1 lac per year. Am I right in my assumption? Please clarify.
Will bank statements (loan statements) clearly specify the interest amount and the principal amount for that year? Or do I need to explicitly collect this document from Bank?
Is it wise to go for a Home loan with shorter (say 6-7 yrs)tenure or longer tenure (10-12 yrs)?
