Home Loan on Rs. 95,000 Salary: Eligibility, EMI, and Tips

Taking a home loan is a big step in anyone’s life. It is exciting to think about owning your own home, but before diving in, it's essential to understand how your salary affects the amount you can borrow. If you earn Rs. 95,000 a month, you are likely wondering how much of a home loan you can afford and what your options are.

Let us break it down.

What is a home loan?

A home loan is a sum of money borrowed from a bank or financial institution to buy a property. The loan is paid back in monthly instalments, also known as EMIs (equated monthly instalments). The lender gives you the loan amount, and you agree to repay it with interest over a set period, typically ranging from 10 to 30 years.

Can you get a home loan on a Rs. 95,000 salary?

Yes, you can qualify for a home loan on a Rs. 95,000 salary. However, the loan amount that you qualify for depends on several factors, such as your age, employment status, credit score, and the lender’s eligibility criteria. Banks and financial institutions generally lend up to 60-70% of your monthly income as EMI, which means your total monthly EMIs should not exceed 60-70% of your salary.

For someone earning Rs. 95,000, you might be able to afford an EMI of around Rs. 57,000 to Rs. 66,500.

But how does this translate into a loan amount? Let us take a look at the following factors that influence the loan amount you can get.

1. Salary: Your salary is a primary factor in determining how much you can borrow. A higher salary allows you to afford a higher EMI, which means you qualify for a larger loan.

2. Debt-to-income ratio: Lenders look at how much you are already paying in monthly debts, such as credit card bills or personal loans. Your total debt payments (including the new home loan EMI) should not exceed 50-60% of your salary. So, if you already have other loans, it could affect the loan amount you can get.

3. Credit score: A good credit score (typically 725 or above) increases your chances of getting a home loan at a favourable interest rate. A poor credit score could reduce the amount you can borrow or even disqualify you from getting a loan.

4. Loan tenure: The longer the tenure of your loan, the lower your monthly EMI will be. However, a longer tenure means more interest to pay over time.

5. Down payment: Home loans usually require a down payment of 10-20% of the property's value. For a property worth Rs. 50 lakh, you may need to pay Rs. 5-10 lakh upfront, while the remaining amount can be financed through a home loan.

6. Age: Your age plays a role in determining the loan tenure. With Bajaj Housing Finance, a salaried applicant must be between 23 years to 67 years, and a self-employed professional must be between 23 years to 70 years.

EMI calculation on Rs. 95,000 salary

Let us assume you earn Rs. 95,000 per month, and you want to know how much home loan you could qualify for. Based on your monthly salary, you could likely afford an EMI between Rs. 57,000 to Rs. 66,500. Here is an example of how the EMI might work:

• Loan amount: Rs. 50,00,000 (Rs. 50 lakh)
• Interest rate: 8.5% per annum (average rate)
• Tenure: 20 years (240 months)

Using the EMI formula:

EMI=P×r×(1+r)n÷((1+r)n−1)

Where:

• P = Loan amount
• r = Monthly interest rate
• n = Loan tenure in months

Based on an interest rate of 8.5% per annum, for a loan amount of Rs. 50 lakh with a tenure of 20 years, your EMI would be approximately Rs. 43,391 per month. This is within the range of Rs. 57,000 to Rs. 66,500, leaving you with enough room in your budget for other expenses and savings. This example shows that if you earn Rs. 95,000, you can easily afford a loan of Rs. 50 lakh, provided other eligibility criteria are met.

But, if you do not want to go through a complicated process, you can leverage a home loan EMI calculator, as it makes things much simpler. In just a few clicks, you can quickly figure out your EMI amount. It provides accurate results, saving you both time and effort, while empowering you to make smarter, more informed choices.

How Bajaj Housing Finance Home Loan can help

If you are looking for a reliable home loan provider, Bajaj Housing Finance offers competitive interest rates, flexible tenure options, and easy eligibility criteria. Whether you are buying your first home or upgrading to a larger one, Bajaj Housing Finance can help you make your dream home a reality. Here are some benefits of opting for a Bajaj Housing Finance Home Loan:

1. High loan amount: Secure funding up to Rs. 15 crore* to turn your dream home into reality.

2. Low interest rates: Enjoy interest rates starting 8.25%* p.a, and EMIs as low as Rs. 741/lakh*.

3. Quick approval: Get approved within 48 Hours* of applying – sometimes even sooner.

4. Flexible repayment tenure: Choose a repayment term of up to 32 years for comfortable EMIs.

5. Simple application: Take advantage of doorstep document collection for a smooth process.

6. Balance transfer facility: Move your existing home loan and get a top-up loan with better terms.

Explore your options today and turn your property dreams into reality.