6 Factors That Can Affect Your Home Loan Eligibility
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6 Factors That Can Affect Your Home Loan Eligibility

  • Highlights

  • A good credit score will get you a high sanction

  • Your income & employment defines your repayment strength

  • Your age is a determining factor for your home loan

  • A high loan to value ration means flexible loan terms

As per the basic eligibility for a home loan, you must be a citizen of India and at least 21 years of age when applying for it. Apart from this, lenders put in place a variety of parameters based on which they verify and judge your eligibility for a home loan. These include your age, income, credit history, city of residence, etc. So, in order to get a quick sanction on a high amount at nominal interest rates you must meet these home loan eligibility criteria.

Take a look at the factors that determine your eligibility for a home loan.

Your credit score

A healthy credit score of 750 and above can directly impact the home loan rates of interest offered to you. Your score takes into consideration factors such as your repayment history, how many existing loans and credit card dues you have, and what kind of debt you have borrowed in the past. Thus, a lender can use this number to measure your financial credibility to assess your repayment capacity before approving the loan.

Your existing debt obligations

Numerous debts and loans are not a problem. However, unpaid dues are always a concern for lenders. Also lenders pay special attention to your repayment pattern. Missing EMIs regularly, making EMI payments after due date, and varied unpaid dues are a cause of concern for them. So be disciplined with your credit repayment to get a high amount sanction on flexible terms and a nominal interest rate.

Your income

Based on the city you reside and work, every lender sets a minimum income criterion. Meet these criteria to get a home loan with ease. For example, you can qualify for a Home Loan sanction of up to Rs.10 crore on a tenor of 25 years with lenders such as Bajaj Finserv on a minimum salary of Rs.25,000 per month from cities like Gurugram, Hyderabad, Kolkata, etc. Additionally, you get benefits like 3-EMI holiday, low interest top-up loan, repayment flexibility, etc., on your home loan with this NBFC.

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Your employment status

Just like your income, your employment status is also very important. Being employed with an MNC and a reputed private or public-sector company deems you more reliable as a borrower. Similarly, as a self-employed individual if you have a stable business income, then lenders are more likely to give you a sanction on flexible terms as compared to someone with an unstable job or business.

Your age

All these previously mentioned home loan eligibility criteria are factored alongside your age. This is because the lender is concerned with how many years you have left as a salaried or working professional. Availing a home loan decades before retirement, during the early years of your career, allows you to get a quick sanction on a sufficient amount. To check your eligibility, you can use the Home Loan Eligibility Calculator on websites of lenders like Bajaj Finserv. Here, you can also see the tentative home loan amount you qualify for.

Your property details and LTV ratio

The property or home for which you are taking a home loan is also of concern to lenders. This is because your property is the security based on which you get the loan. So, if your property is worth more, you will get a higher loan amount and vice versa. So, choose the right property that has the potential to increase in value in order to secure substantial funds. Secondly, lenders consider how much you are paying as down payment and how much you need financing for. If you have funds for a 20% down payment, you are likely to get a home loan easily. If you want more funds, you may not be able to secure enough or may have to pay a higher home loan rate of interest.

Equipped with the knowledge of these factors, check your home loan eligibility. Once you know you qualify for a loan with your chosen lender, you can calculate the affordability of your home loan using the home loan EMI calculator.

Bajaj Finserv brings you pre-approved offers for personal loans, home loan, business loans and a host of other financial products. Not only does this simplify the process of availing financing, but also helps you save on time. All you have to do is share a few basic details and check out your pre-approved offer.
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