EMI payment contribution between co-owners who are co-borrowers
EMI payment contribution between co-owners who are co-borrowersApnaloan.com Research Bureau
10 Aug 2007
How do we pay for our respective shares of the loan? Should we give proportionate cheques for each EMI or contribute the EMI amount proportionately to a joint account from where we can make this payment? Another option is to pay 8 EMI cheques from the husband's account and 4 EMI cheques from the wife's account? From a tax point of view which is the better option?
The bank is unlikely to accept proportionate payment for each EMI from both of you since most banks' internal systems do not provide for accepting 2 cheques for the same EMI. The second option though correct, can be slightly cumbersome so the third option of 8 installment from the husband's account and 4 from the wife's account is ideal. Incidentally, for tax purposes one of you can pay all the installments and seek reimbursement from the other for his/her share as well. Though that is the legal position, from a practical point of view, it might be advisable to follow the 3rd alternative suggested by you.
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