Wondering if You Need a Co-applicant for Getting a Home Loan? Find Out Today!

Lenders often ask borrowers to have a co-applicant while applying for a home loan. This is for their assurance, added guarantee, and sometimes to increase the eligibility of the borrowers. However, usually, the borrowers are unaware of the ins and outs of having co-applicants and fail to understand if they should have one.

If you have been planning to apply for a home loan, you might wonder if you need a co-applicant. Read further to find out.

Who Is a Co-applicant?

A person who applies for a loan with the primary applicant is called a co-applicant. All co-owners should be co-applicants to the home loan. However, all co-applicants do not necessarily need to be the co-owners of the property. Though it is not legally required to have a co-applicant, it is advised that you have a co-applicant if you are unable to meet the lender’s home loan eligibility criteria.

Who can be a Co-applicant?

  • Your spouse, parents or siblings can be co-applicants for a home loan.
  • Husband-wife, father-son and brothers can avail a joint loan.
  • There are certain restrictions for a joint loan taken by a father and unmarried daughter.
  • A person with whom you do not have blood relation, like a friend or distant relative, cannot co-apply with you.
  • Your co-applicant should meet the eligibility criteria of the lender too.
  • A minor cannot be a co-applicant.
  • The co-applicant should receive a steady flow of income.

Benefits of Having Co-applicants

If you have a co-applicant, you can avail a higher loan amount as the lender clubs the income of all the co-applicants. When you add a co-applicant with a good credit score, it helps in improving the overall loan eligibility. Also, both the applicants can avail tax benefits on home loan in proportion to their EMI contribution.

Liability of a Co-applicant

The co-applicant is equally liable for the home loan as the primary applicant. So, while they contribute towards the EMI, on default, the lender has the right to take steps to recover the loan amount from them and take legal action if needed.

Therefore, when planning to have a co-applicant, borrowers should carefully read the terms and conditions. Similarly, you must consult an expert before signing below the dotted lines.

Do You Need a Co-applicant?

Whether you need a co-applicant or not should depend on your financial conditions and eligibility level. If you have a good credit score and your age and income meet the lender’s eligibility criteria, it might not be useful to have a co-applicant, as it would add to the loan burden on the co-applicant. However, if you wish to avail a high loan amount, the lender might not approve the loan unless you have a co-applicant. It is best to assess your financial situation and understand the liabilities of having a co-applicant before making a decision.


Considering the benefits and liabilities of having a co-applicant, you must take the decision thoughtfully. While having a co-applicant can be an added burden on the family finances, any default on their part can adversely affect your credit score as well. Therefore, it is best to make an informed decision only after checking all the aspects of taking a joint home loan.