Your flat is delayed. Your EMI isn't. What now?
Published by India Today
Abhishek Kumar's role: Quoted
Abhishek Kumar said paying rent and a home loan EMI together can severely strain household cash flow, and that buyers may lose Section 24(b) interest deductions if possession comes after five years. He described a couple who had to halt investments and borrow from relatives.
What Abhishek Kumar said
How does a delayed flat affect a family's monthly budget?
When possession is delayed, many families end up paying rent and the home loan EMI together, and that can create a severe cash-flow problem that eats into what is left each month. I recently worked with a couple who had a ₹50 lakh home loan and were also paying ₹35,000 a month in rent. They put all their investments on hold apart from PF, slipped behind on their credit card payments and eventually needed loans from relatives.
Can a delay in possession cost me a tax benefit on my home loan?
Yes. Under the old tax regime, Section 24(b) allows a deduction of up to ₹2 lakh a year for home loan interest, but the full amount is available only if possession comes within five years from when you took the loan. So a long delay in handing over the flat can cut a tax benefit that you may have counted on when you planned the purchase.
What happens to my other financial goals if possession is delayed for years?
When the delay runs into several years, the SIPs set up to build long-term wealth are usually the first thing families stop. If the delay drags on, they may use up their emergency fund, compromise on retirement planning and fall behind on saving for their children's education. So I see a delayed flat as a strain on the whole financial plan, not only on the home purchase.
In our words, from what he said in the piece. General information, not personal advice.
More of Abhishek's views on debt and loans
The article looks at delayed possession of under-construction homes in India, where lakhs of units remain stalled. It explains buyers' rights under RERA, when to file a complaint, refund and delay-interest options, why stopping EMIs is not advisable, the cost of pre-EMI interest and the documents buyers should keep.
Publisher source
Your flat is delayed. Your EMI isn't. What now?