Home Loan Eligibility Calculator

Buying a home which one can call their own is a distant dream for many. And with property rates touching the sky, a home loan is the only solution to buy yourself a home. The market is flooded with home loan providers who offer loans at competitive rates of interest. The home loans are secured loans which are given against the property as security. Each lender has pre-defined eligibility criteria defined on the basis of which one can apply for the home loan with them. Failing to follow the eligibility criteria can result in your home loan application getting rejected which would mean a blot on your credit report.

Online tools like home loan eligibility calculator help you calculate the loan amount which you can avail. It takes into consideration your income, age, repayment capacity etc and gives an estimate of the loan amount you are eligible for. However, banks and lenders uphold the sole discretion of offering the home loan to the applicant. Some other factors which the lenders consider include credit score, income, employment etc. One can check for housing loan eligibility online on Loansjagat portal and check the home loan amount which you can avail. Home loan eligibility calculator is easy to use and give accurate results in a fraction of seconds.

Though each lender has different home loan eligibility criteria, here are a few common aspects which are considered by the home loan providers.

• Nationality: Home loan can be availed by all Indian residents, Non-Indian Residents (NRIs) and Person of Indian Origin.
• Employment: The applicant must be either a salaried employee or self-employed. Lenders consider this aspect to get hold of your repayment capacity and financial stability. Salaried employees working with reputable companies are much preferred as they signify that they will get the salaries on time and thereby will pay the monthly EMI timely.
• Income: The total monthly income should be Rs. 25000 or more.
• Age: Home loan applicant must be between 18 years to 70 years of age group. Lenders prefer younger applicants as they have long work life ahead in comparison to ones who are in the late 40s.
• Credit Score: A credit score between 550-900 is considered acceptable for a home loan. Higher the credit score, the better the chances of getting the home loan application approved easily are high.
• Work experience: Salaried employees should have minimum work experience of 2 years to avail a home loan.
• Business continuity: Business owners shall have their businesses into operations for at least 3 years to avail a home loan.
• Loan to value ratio: Usually lenders offer up to 90 per cent of the loan of the value of the property. The home loan provider takes the age and location of the property into account and the home loan application may get rejected if the residual age of property is less or it isn’t part of the prescribed geographical area.

The lenders also consider your fixed obligations to income ratio to know about the monthly EMI which you will be able to pay off comfortably.

Home loan eligibility is determined by the following factors:

1. Credits score: Credit score is the most important thing considered by the lenders as it reflects your previous loan repayments and your creditworthiness in general. A good credit score enhances your chances of getting the home loan application approval and getting a better deal in terms of rate of interest and loan tenure. A poor credit score may result in getting your application rejected straightway or you may be charged a higher rate of interest.
2. Age of the applicant: Home loans are offered for long tenures which range up to 20-30 years. To be secure on the repayment aspect of the loan, the lenders prefer young borrowers who have long work life ahead so that he can repay easily. Mid age or higher age groups are not much preferred as the job stability gradually decreases.
3. Debt to Income ratio: Since a home loan is a long term commitment, lenders take your ongoing loans and debts into consideration.  A high debt to income ratio means that a major portion of your current income is going to pay back the existing debts. This signifies your higher chances of defaults in the future.  The debt to income ratio thus not cross the 50 per cent mark if you wish to get the home loan application approved.
4. Property: The age and location of your property are also taken into account by the lenders.
5. Work stability: Lenders are concerned with the repayment of the loan and hence they consider the work stability of the borrowers. The salaried individuals with at least 2 years in the industry or self-employed individuals with 3 years of experience are considered stable enough to take on the load of the monthly EMIs.
6. Down Payment:  According to the RBI, the lenders can offer home loan amount up to 90 per cent of the value of the property. This means a down payment of a certain amount is mandatory. Higher down payments enhance your home loan eligibility by decreasing the LTV ratio.