ave a query regarding your home loan? Maybe we can help.

Drop us a line and our expert, Harsh Roongta, will answer it.

• Got a question for Harsh Roongta? Please write to us!

What happens to the balance home loan amount if the loan applicant dies? Does the co-applicant or the survivor have to pay for it?

What if the survivor cannot afford to do so?

- Mitesh Arvind Shah

The co-applicant/inheritor will have to pay off the loan and take over full rights of the property.

If the home loan company is satisfied about the credit standing of the co-applicant/inheritor, it may continue the loan with them.

In this case, the loan will continue as per the original (or any other discussed and agreed upon) schedule.

If there is no co-applicant/inheritor, the home loan company can take possession of the property and sell it to realise its loan amount.

• 5 questions home loan seekers ask

Has service tax been notified? I booked a flat and have to get it registered.

My builder has been asked to pay a service tax @ 3% of the cost of the flat. He wants to increase my rate per sq ft.

- Anil Dureja

As of today, the service tax has not yet been notofied. This demand does not seem justified. 

• 10 home loan terms you must know

Three years ago, I took a home loan of Rs 550,000. It is a 15-year floating rate loan.

Now, I want to pre-pay Rs 150,000. Will it be a good idea to pre-pay at this stage or should I let the loan continue as usual?

- Paramjit Singh

That depends on the return you can expect if you invest the surplus Rs 150,000.

If the post-tax return on that amount is better than the post-tax cost of the loan, invest the money rather than pre-pay the home loan.

As per the recently passed section 80C, you will be eligible for a deduction on the amount prepaid upto a sum of Rs 100,000 (in conjunction with other deductions available under that section).

To find out what falls under Section 80C, read All about Section 80C.

You should also take  into account the fact that you may require the surplus cash for some emergencies in the future.

• Claim home loan benefits, HRA

I booked a house under construction that will be ready by March 31, 2006.

I am paying a construction-linked Equated Monthly Instalment, which is split into principal (35%) and interest (65%). What will be my tax benefit?

- Abhyuday Singh

If the house is occupied by March 31, 2006, you will get tax benefits on the entire loan repayments made during this year, irrespective of whether they are for the period before the construction is complete or after. 

Got a question for Harsh Roongta? Please write to us!

Note: Questions may be edited for brevity. Due to the tremendous response, all queries will not be answered.

Disclaimer: While efforts have been made to ensure the accuracy of the information provided in the content, rediff.com or the author shall not be held responsible for any loss caused to any person whatsoever who accesses or uses or is supplied with the content (consisting of articles and information).

Illustration: Dominic Xavier