Buying a flat jointly

Buying with someone else – a spouse, a parent, a sibling, a partner – is the ordinary way most flats in Bengaluru are bought. It pools income for a bigger loan, and it can make sense for how the flat is meant to be used and, eventually, passed on. But “joint” is not one thing. You can be a co-owner, a co-borrower, a guarantor, or some mix of the three, and each carries a different set of rights and a different bill if things go wrong.

This guide works through what actually changes when you buy jointly: who needs to be named where, what Karnataka charges in stamp duty, how tax and the loan application treat two names instead of one, what happens if a co-owner dies or you later disagree about selling, and how rent is split and taxed if you let the flat out. Several pieces – the tax deduction itself, the loan co-applicant rules, and buying with an NRI co-owner – are covered in full in other guides; this one gives you the joint-specific angle and points you to the rest.

Co-owner, co-borrower, guarantor

These three words get used loosely, but they describe different legal positions, and a flat can have people in any combination of them.

A co-owner is whoever is named as a purchaser in the registered sale deed. Ownership is a sale-deed question: nothing short of a registered conveyance transfers title in India, whatever a loan document or an informal understanding between family members says. A co-borrower (sometimes called a co-applicant) is whoever signs the loan agreement with the bank and is liable for repaying it. The two lists often overlap, but they do not have to. Several lenders’ own published rules make the gap explicit: HDFC Bank requires every co-owner to be a co-applicant on the loan, but that is a lender’s condition, not a rule of property law – being a co-borrower does not, by itself, make you an owner. Our affordability guide covers what different banks ask for in a co-applicant.

A guarantor is different again, and is not a party to the sale deed at all. Under the Indian Contract Act, 1872, “a contract of guarantee is a contract to perform the promise, or discharge the liability, of a third person in case of his default. The person who gives the guarantee is called the ‘surety’... the person to whom the guarantee is given is called the ‘creditor’.” A guarantor’s obligation is secondary: it activates only if the borrower defaults. But once it does, it is not partial. “The liability of the surety is co-extensive with that of the principal debtor, unless it is otherwise provided by the contract” – meaning a bank can pursue a guarantor for the whole outstanding amount, not just a share of it, unless the guarantee itself says otherwise.

Put the three together and the practical differences show up clearly in what each combination can claim, and what it is on the hook for.

Whose names go on the deed

Every co-owner should be named as a purchaser in the registered sale deed, with their share stated – equal, or a specific proportion, but stated either way. Karnataka’s own model agreement for sale already anticipates more than one buyer: its clause on “Joint Allottees” says “all communications shall be sent by the Promoter to the Allottee whose name appears first... which shall for all intents and purposes to consider as properly served on all the Allottees,” so from the very first document, one of you is the point of contact even though both of you hold the flat.

Do not leave the shares to be worked out later. The Transfer of Property Act sets a default rule for exactly this gap, and it is not always an equal split: “Where immoveable property is transferred for consideration to two or more persons and such consideration is paid out of a fund belonging to them in common, they are... respectively entitled to interests in such property identical, as nearly as may be, with the interests to which they were respectively entitled in the fund; and, where such consideration is paid out of separate funds belonging to them respectively, they are... respectively entitled to interests in such property in proportion to the shares of the consideration which they respectively advanced.” Only where there is no evidence of who paid what does the law fall back on an equal split. If you contributed unevenly – a bigger down payment from one of you, say – say so in the deed, because otherwise a later dispute is decided by whatever payment trail can be reconstructed, not by what you both actually intended.

An NRI co-owner

If one of you is an NRI or OCI, FEMA governs what you may jointly buy and how the NRI co-owner may pay their share – broadly, a residential or commercial property, funded by inward remittance or an NRE, NRO or FCNR(B) account, under Rule 24 of the FEMA (Non-Debt Instruments) Rules, 2019. Everything else about buying as an NRI – the home loan, power of attorney, TDS and repatriating the proceeds later – is covered in full in our NRI buying guide; it applies to an NRI co-owner exactly as it does to a sole NRI buyer.

Stamp duty for joint buyers

Buying with someone else does not change what Karnataka charges in stamp duty or registration fee. The Schedule to the Karnataka Stamp Act sets the rate by the value of the property being conveyed, under Article 20 – 5% on an ordinary sale, with lower slabs on a builder’s first sale of a flat up to ₹45 lakh, plus cess, surcharge and a 2% registration fee. Nothing in that Schedule varies the rate by the number of buyers named in the deed, or by whether any of them is a woman. Some other states give a lower rate to a woman buyer; Karnataka, on the rate the Schedule actually sets, does not. If a booking form or a sales pitch mentions a discount for a joint purchase or a woman co-owner, ask exactly which charge it is meant to reduce – it is not the state’s stamp duty. Our full-cost guide works through every charge on a flat, line by line.

Tax and the loan together

Tax on a jointly owned home is handled fully in our home loan tax benefits guide: in short, co-owners with a definite, recorded share are taxed “separately under this Part as per their respective share,” not as a single unit, so each of you can claim your own interest and principal deduction, within your own caps – but only if you are both an owner on the deed and a borrower on the loan. That guide works a full example on doubling the deduction; this one does not repeat it.

On the loan itself, adding a co-applicant is usually how a joint purchase becomes affordable in the first place, since a second income raises what a bank will lend. Lenders differ on who qualifies as a co-applicant and whether they must also be an owner – our affordability guide sets out what several banks actually require.

When a co-owner dies

This is where buying jointly is most often misunderstood. Many buyers assume that if one of them dies, the flat simply becomes the survivor’s, the way it might under a foreign “joint tenancy.” Indian property law does not generally work that way.

Survivorship or succession

For an ordinary jointly bought flat, a deceased co-owner’s share does not pass automatically to the surviving co-owner. It passes by succession – under a will if there is one, or otherwise under whichever intestate-succession law applies to the deceased – to their legal heirs, who may or may not include the surviving co-owner. Even within Hindu law, where a form of survivorship historically did apply to a share in ancestral, jointly held family property, that rule was abolished by statute in 2005: “Where a Hindu dies... his interest in the property of a Joint Hindu family governed by the Mitakshara law, shall devolve by testamentary or intestate succession, as the case may be, under this Act and not by survivorship.” If even that older, narrower form of survivorship no longer applies, there is no broader rule that would hand an ordinary co-owner’s share in a flat you jointly bought to you automatically either.

A nominee is not an heir

Naming a nominee – on a home loan account, an insurance policy, or an association’s membership records – is worth doing, but it does not settle who inherits. The Supreme Court has been explicit that a nomination binds only the record-keeping body, not the question of title: “transfer of share or interest, based on a nomination... is with reference to the concerned Cooperative Society, and is binding on the said society. The Cooperative Society has no option whatsoever, except to transfer the membership in the name of the nominee... That, would have no relevance to the issue of title between the inheritors or successors to the property of the deceased.” The Court let the nomination stand for the purpose of the society’s own records, while leaving the family free to fight out who actually inherited, separately, under succession law. Treat a nominee the same way: useful for updating records quickly, not a substitute for a will.

A will still controls your share

Each co-owner can leave their own share by will, and a valid will overrides the default intestate rules for that share. Hindu law says so expressly: “Any Hindu may dispose of by will or other testamentary disposition any property, which is capable of being so disposed of by him.” A will covers only the share of the person who made it – co-owners who both want certainty should each make their own, naming who is meant to inherit their half, rather than assuming the other co-owner is automatically covered.

If you disagree about selling

Co-ownership does not give either of you the right to sell the whole flat alone. What a co-owner can do alone is transfer their own share, and a buyer of that share steps into the same position the seller had – including the right to ask for a partition: “the transferee acquires as to such share or interest... the transferor’s right to joint possession or other common or part enjoyment of the property, and to enforce a partition of the same.” In practice, a buyer for a bare undivided share in someone else’s flat is hard to find, so this route is rarely attractive on its own.

Where co-owners genuinely cannot agree, either can go to court and ask for a partition. A single flat usually cannot be divided by walls and a fresh survey the way a plot of land can, so the law expects the court to order a sale instead of a physical split wherever division “cannot reasonably or conveniently be made”: “the Court may, if it thinks fit, on the request of any of such shareholders interested individually or collectively to the extent of one moiety or upwards, direct a sale of the property and a distribution of the proceeds.” That outcome – a forced sale, with proceeds split by share – is the backstop the law provides; getting there needs a lawyer and a civil suit, and is worth treating as a last resort rather than a first move.

Renting it out together

If you let the flat out, the rent is taxed on each of you according to your recorded share, not by however you choose to divide the cheque. The same rule that separates your tax computation for deductions applies to income too: co-owners with a definite share are taxed “separately... as per their respective share,” and the house-property income itself is charged on “the owner” of the property. Say two co-owners hold a flat 60:40 and let it for ₹30,000 a month, ₹3,60,000 a year. Each declares their own share of that rent: 60% is ₹2.16 lakh, 40% is ₹1.44 lakh – not whatever informal split you might agree between yourselves, and not an automatic 50:50 regardless of the deed. Deductions against that rent – the standard 30%, and interest on any loan – work the same way, each owner claiming against their own share; our tax guide covers a let-out home’s deductions in full. Our guide to letting out your flat covers the agreement itself.

Before you buy jointly

• Decide who is an owner, who is a borrower, and who is a guarantor, and understand that these are three different things.
• Name every co-owner in the sale deed, with each share stated, equal or not.
• Do not expect a stamp duty discount for buying jointly or as a woman; Karnataka’s Schedule sets none.
• Check you are on both the deed and the loan before counting on a tax deduction.
• Each make a will for your own share, rather than assuming the other co-owner inherits automatically.
• Treat a nominee as a record-keeping convenience, not a substitute for a will.
• Split rent by your recorded share, and declare it that way.