Home equity loan- tax rebate

as you said home equity loan was taken for purchase of another house property then intt. on such loan can be claimed as deduction under sec 24b. since now you own two house properties, only one of them will be treated as self occupied and other one will be deemed to let out. deduction of intt on loan (whether traditional home loan or home equity loan) will be subject to a max of 150000 in case where the property is considered to be self occupied.

let us understand with an example. you purchased prop. A with tradional home loan and pay intt 200000 annually. now you took home equity loan by mortgaging prop. A and purchased new prop. B. intt on home equity loan is 180000 annually. now since you own both prop. A and B, either of one will be deemed to be let out. suppose prop. A is treated as self occupied and B is deemed to be let out or it is actually let out and earns you rent. then deduction under 24b for intt on loan in case of prop. A will be 150000 and prop. B will be 180000...... if above situation is reversed and A is let out and B is self occupied then deduction under 24b will be 200000 for A and 150000 for B.

had this home equity loan been taken for any purpose other than repair of house, construction of house or purchase of new house, then deduction under sec 24b will not be available.

Yes. I have used the loan amount from Home Equity as downpayment for buying a new property.

Moreover, the Home Equity interest amount is just 40,000 p.a and I anot concerned if it falls under 1.5 lakh bracket (self occupied or let-out). It does not anyway apply here!!

SBI bank says they will not issue interest certficate for Home Equity loan. Is this correct?

Regards

Siva G 

you should be concerned for 40000 as it is available for deduction under 24b. if the bank is not providing interest certificate then just ask them to print out ledger for FY 13-14 and it will do your needful.

If i purchase a residential plot with home equity loan, mortgaging my second house, is the interest paid is tax deductible? I show my loan for this second house under section 24b.