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PF Amount Withdrawal For Home Loan Repayment, Step-by-Step Guide
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India, 9 March 2023 7:43 AM GMT
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Guest Author : Vakilsearch
Vakilsearch.com is the pioneer online platform that provides legal services to startups, corporates and professionals in India.
Employees' Provident Fund (EPF) is a social security plan that allows employees to save a small portion of their earnings for future benefits. This article will help you understand how you can withdraw the PF amount for home loan repayment.
Employees' Provident Fund (EPF) is a social security plan that allows employees to save a small portion of their earnings for future benefits. This article will help you understand how you can withdraw the PF amount for home loan repayment.
Home loan interest rates have recently risen in response to hikes in the RBI repo rate. Some banks have boosted interest rates for both new and current customers. As a result of rising interest rates on home loans, there has been discussion over what borrowers should do to reduce their interest payments against their outstanding loan amount. The solution: One can think about paying off their mortgages in full or in part with money from their EPF.
Employee Provident Fund Organization, or EPFO, is a system established by the Government of India that permits employees to make partial or 'advance' withdrawals from the provident fund corpus under certain conditions. It aids in the accumulation of assets for post-retirement life.
Can EPF Balance Be Withdrawn For Repayment Of Home Loan?
According to Section 68BB of the EPF policy, the EPF amount can be withdrawn for the repayment of a home loan. The house, however, must be registered in the name of the PF member, either singularly or jointly. However, the housing loan applicant must have paid PF contributions for at least ten years to do so. The withdrawn PF amount will not be taxed after five years of continuous service.How To Withdraw Your PF Savings For Repayment Of Home Loan?
You can use the EPF corpus to pay off the home loan and reduce your interest outlay if the home loan interest is larger than the EPF interest. You may be able to preserve your EPF corpus if the interest on your EPF is greater than or equivalent to the interest on your mortgage. Our Vakilsearch’s team of experienced legal advisors is a phone call away should you have any queries about the process. Their experts can complete the entire process on your behalf and even ensure that your doubts are cleared before they even arise. Also Read: Meet Captain Shaliza Dhami, First Woman In Indian Air Force To Command Combat Unit
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