Housing loan exemption limit increased from 1.5 to 2.5 lakhs for first time homebuyers:
A person taking a loan of Rs. 25 lakhs for his first home will get Rs. 1 lakh additional exemption on repayment of interest component; therefore, the exemption limit has now increased from 1.5 to 2.5 lakhs in such cases.
But, this exemption is allowed only under the following conditions.
· The increase in exemption limit is only for this year alone.
· This increase in exemption limit does not apply to existing home loan takers. It is only for the loan sanctioned by the financial institutions during 1st April 2013 to 31st March 2014.
· The loan is taken for your first home i.e., you as a taxpayer do not already own a residential property on that date.
· The value of the property does not exceed 40 lakhs.
· The loan amount does not exceed 25 lakh.