Interest on loan as cost of flat

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If you've contributed more to a jointly purchased flat by paying loan interest, you might be wondering if this increases your ownership share. Generally, how you fund your portion of the investment, including loan interest, doesn't alter the agreed-upon ownership percentages unless there's a specific agreement between the parties. Without such an agreement, your ownership stake remains based on the initial contributions, and the loan interest is considered your personal cost.

Shailendra Kumar Saxena

Shailendra Kumar Saxena (Querist)

03 May 2024 Please advise. I purchased a flat with another person for 30 lacs. Other person contributed 15 lacs, I paid 10 lacs and took a loan of 5 lacs over that flat and contributed. Now both contributed 15 lacs each. I am the one who is paying interest on loan. At the time of sale, can I claim this interest as my contribution in this flat and ask for more percentage?

Nikhil Kaushik

Nikhil Kaushik (Expert)

03 May 2024 cost of funding does not change the percentage of ownership unless there is an agreement to that effect between parties.

Shailendra Kumar Saxena

Shailendra Kumar Saxena (Querist)

03 May 2024 Please clarify. There is no agreement. In my opinion, I cannot claim interest as cost of flat as other party has nothing to do with this interest matter. It is my personal. Am I correct?
The cost will remain 30 lacs and not 30 lacs+ interest.

Nikhil Kaushik

Nikhil Kaushik (Expert)

03 May 2024 yes. how you fund an investment has nothing to with the percentage of ownership.

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