Second home loan : need help

I am planning to buy a second home; hence I would be taking second home loan as currently I have one home loan for the flat in which I currently stay. I am looking for second home to be available after 2 to 3 years from now. Below are the rough details of my 1st home loan and possible 2nd home loan:

• 1st Home loan: Interest Rate: 11.75% Interest Component < 1.5 lakhs/annum, Principal Component > 1.00 lakhs/annum.
• 2nd Home loan: Interest Rate: 10.1 to 10.5%, Loan amount would be around 50 - 65 lakhs.

 I need advice with respect to tax planning for my investments, below are the options I have with me with respect to home loans:

1. With current savings available close current home loan and take fresh home loan for second home. The only advantage by this option I see is that I have to pay only one EMI. Disadvantage I can see it that: Can’t claim housing loan interest component for tax exemption.
2. Keep current loan and take new loan for 2nd property for lesser amount (may be 10 lakhs less). Advantage: Can claim housing loan interest component for tax exemption from first loan. Disadvantage: total EMI will be higher, total payment to bank is higher.

Please note that I fall under 30% taxable income bracket. Please help me with above two options, or suggest if any other options available.

Thanks in Advance !