Home loan eligibility criteria has common parameters across all banks and Non-Banking Financial Companies (NBFCs). However, there could also be specific criteria that is applicable for each lender according to their requirements. Understanding the criteria that is required to be eligible for a home loan helps to ensure that the process of application becomes smoother and easier for you.Eligibility criteria for Home Loan
|Age||18 - 70 years|
|Credit Score||Above 750|
|Employment Status||Salaried or Non-Salaried|
|Work Experience||2 Years|
|Loan Amount||Decided by the lender|
|Residence Type||Permanent resident or Non-resident Indian (NRI)|
|LTV Ratio||Up to 90%|
|Property Type||Completed /Under Construction Project, Land/Plot, build on own Land, Buy Land and Build Home|
Note: Loan eligibility criteria differ depending on a bank/lender. Approvals are based on borrowers' incomes, credit profile and existing relationship with the bank.
|HDFC Home Loan Eligibility||
|SBI Home Loan Eligibility||
|Axis Bank Home Loan Eligibility||
|LIC HFL Home Loan Eligibility||
|BoB Home Loan Eligibility||
|PNB Home Loan Eligibility||
|DHFL Home Loan Eligibility||
|Canara Bank Home Loan Eligibility||
|IDBI Bank Home Loan Eligibility||
|Indiabulls Home Loan Eligibility||
Once you have figured out your eligibility for a home loan, you can check home loan interest rate for all banks and apply for the one that suits you best.
Use the home loan eligibility calculator to check which are the banks you are eligible for a home loan. You can easily compare and choose the best home loans with the help of the home loan eligibility calculator available on BankBazaar. The process is simple and only basic details will need to be entered. The step-by-step procedure to check your eligibility via BankBazaar.com is mentioned below:
After this step, you will be able to check all the home loan offers that you are eligible for and apply for a home loan. You can also consider using the BankBazaar Home Loan EMI Calculator to calculate your effective EMI amounts for the home loan product that you want to choose.
Chandra Patra is an employee of a leading company in India. His salary break up is mentioned below:
Let us consider that Chandra has no loans or liabilities at present and his net available income is Rs.1,03,400. However, you one must always remember that Leave Travel Allowance is not taken into consideration by the bank while calculating the salary. The medical allowance is also excluded from the calculation. This is because, these expenses are not derived by an individual with his/her salary. In this case, Chandra will only get these amounts as reimbursements, in case he spends on medical needs or travel requirements.
Thus, the bank or the lender will deduct that LTA and medical expenses from the net income. Chandra’s net income now stands at Rs.1,03,400 – Rs.(9,000 + 2,000), which is equal to Rs.92,400. Thus, the loan eligibility for Chandra Patra stands at Rs.92,400 x 60 = Rs.55,44,000. In case of a home loan, EMI is restricted to a maximum of 40% to 50% of the net income (monthly) by most banks. This suggests that you are eligible for a home loan where the equated monthly instalment is not more than 50% of your monthly income.
As mentioned earlier, the home loan lenders determine the eligibility of an applicant for home loan on the basis of their monthly income (in addition to other factors). The salary is taken into consideration to identify the loan repayment capability of the applicant. The LTV ratio or the Loan-to-Value ratio is used to assess the risk factor involved in the case of a loan disbursal.
The eligibility criteria for home loans differ slightly for salaried and self-employed employees. For most lenders, the requirement in regard to the age bracket, residential status, credit score, etc. are usually the same for both salaried and self-employed employees. However, the requirement in terms of the overall working experience and minimum income can differ. On the basis of your employment status, you can get in touch with your lender and find out the requirement for the minimum work experience and the minimum income.
If you are a salaried individual working in a private company, you can check how private employees can get home loan.
The list of documents required at the time of applying for a home loan application can vary from lender to lender. In general, an applicant will be required to provide the following:
However, you can check the list of home loan documents required for different types of applicants and apply for your loan accordingly.
You can avail a home loan along with a co-applicant to increase the chances of the loan approval. The main role of a co-applicant is to repay the home loan along with you (if you are the main borrower).
Many banks make it mandatory for co-owners to be co-applicants for home loans. Here is all you need to know about co-borrower vs co-owner vs co-applicant.
The Central Government, through the Ministry of Housing and Urban Poverty Alleviation, has launched the Pradhan Mantri Awas Yojana scheme under which beneficiaries can avail subsidies on their respective home loans. As per the terms and conditions of the PMAY scheme, applicants will be categorised under 4 broad categories – EWS, LIG, MIG 1, and MIG 2. PMAY eligibility criteria for these groups are decided on the basis of the annual family income.
In general, the home loan eligibility criteria for NRIs are in line with that of the general public. In order to avail an NRI home loan, the applicant should be a salaried or self-employed individual, with a good credit score. He or she should be within the age bracket of 18 years to 70 years and must be a Non-Resident Indian or NRI.
There are a number of lenders in India who offer home loans for NRIs.
Home loan eligibility cannot be assessed easily. For most lenders, the conditions may vary. In addition to that, the banks and lenders will be considering your present liabilities, income, assets, etc. while calculating your home loan eligibility. In case the mortgage requirement is slightly higher that the eligible loan amount, some changes in the way you present yourself can help in increasing the eligibility factor.
You can follow some important tips to improve your home loan eligibility.
There are several factors that are considered by banks or lenders to determine if you are eligible for a loan. These factors are mentioned below:
Yes, you can get a top up loan in addition to your existing home loan. However, in order to be eligible for the same, you will be required to make regular repayments for your existing loan.
Yes, you can avail housing loans for under construction properties. However, it should be kept in mind that the amount will be disbursed in instalments as per the assessment of the lender.
Here is all you need to know about how LTV ratio is used to determine home loan eligibility.
The eligibility for a joint home loan is dependent on the relationship of the co-applicants. The co-applicants have to be related in order to be eligible for a joint home loan.
Yes, your parents, children and spouse are considered eligible for being co-applicants for the home loan.
Yes, you can avail tax benefits when you take home loan from a bank or a financial institution under Section 80C and Section 24 under the IT Act.
In case you have a poor credit score, it will be difficult for you to get a home loan. Banks or financial institutions consider your credit report to be of great value while determining your eligibility towards a loan. If you have a good score, banks will be happy to offer you a home loan with attractive rates of interest. However, with a bad score lenders will doubt your repayment capability and might not consider you to eligible for a home loan.
Although there is no mandate for having a co-applicant for a home loan in India, most of the lenders (both public and private) insist on having one to ensure the guarantee in regard to the repayment of the loan amount. In addition to that, having a co-applicant while applying for a home loan will also boost your home loan eligibility. Nevertheless, it should be kept in mind that there is no legal requirement for having a co-applicant when applying for a home loan.
The price of a property which is agreed upon by both the seller and a buyer for a transaction is called the market value of that property. In easier terms, the price of the property at which the seller is ready to sell the property and a buyer is ready to purchase the property is the market value of the property.
In the case of under construction property, the loan amount is disbursed by the lender in instalments and is based on the assessment of the lender and not the developer. The loan amount is disbursed on the basis of the progress of the construction of the property.
Most of the lenders in India (both public and private) require you to provide an amount equivalent to 10% to 20% of the home loan amount as a down payment. This initial amount which is to be provided by you is called the own contribution. Here are some expert tips on how to get home loan on zero downpayment.
Your lender might ask for security when you apply for a home loan. You can provide one of the following as collateral security for home loan eligiblity:
Yes, you can use your existing loan account to purchase a new property. However, this benefit will be offered as per the discretion of your lender. For example, HDFC Bank offers the ‘Home Conversion Loan’ feature which can be used to transfer the existing loan to buy a new property. In addition to that, you can also get additional fund for the new property as per your home loan eligibility.
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