2016 is looking to be one of the best years for home buyers. More tax benefits, rate cuts on loans, stagnant property prices, and new launches in the 'affordable' segment with freebies and attractive payment schemes. Many of you will be looking to take advantage of these benefits and buy a house. While hunting for a house at the right price, you'll be haggling with the bank to cut a loan deal too. Even if you get a discount on both, your tax bill can burn a hole unless you know the rules well. Here goes a list of six lesser known and often-missed tax benefits on home loans.

1. You can claim tax benefit on interest paid even if you missed an EMI.

Unlike the deduction on property taxes or principal repayment of home loan, which are available on 'paid' basis, the deduction on interest is available on accrual basis.

2. Processing fee is tax deductible.

Most taxpayers are unaware that charges related to their loan qualify for tax deduction. As per law, these charges are considered as home loan rates and therefore deduction on the same can be claimed.

3. Principal repayment tax benefit is reversed if you sell before 5 years.

You score negative tax points if you sell a house within five years from the date of purchase, or, five years from the date of taking the home loan.

4. Loans from relatives and friends is eligible for tax deduction.

You can claim a deduction under Section 24 for interest repayment on loans taken from anyone provided the purpose of the loan is purchase or construction of a property.

5. You may not be eligible for tax break even if you are just a co-borrower.

You cannot claim a tax break on a home loan even if you may be the one who is paying the EMI.

6. You can claim pre-construction period interest for up to 5 years.

You know you can start claiming your home loan benefits once the construction is complete and you receive possession.

[Source: http://economictimes.indiatimes.com/wealth/tax/six-things-about-home-loan-tax-incentives-you-didnt-know/articleshow/52395495.cms]