A majority of the people especially the emerging Indian middle and upper middle class dreams of owning a house for their living and comfort. However, due to skyrocketing property prices it becomes difficult to save enough money to buy home independently. Also, due family responsibilities and prior commitments towards other mortgages makes it difficult to save enough to deal in cash while purchasing your home. In such a situation, the most obvious route would be applying for a home loan. In India, there are various leading housing finance companies and banks that offer home loan with interest rates as low as 9.40 to 10% with a low processing fees. There are special concessions for women-oriented loan who are self-independently and working class women who wish to turn their dream into reality. Ideally your housing finance covers up to 80% of the property costs and also offers tax benefits. But, not every salaried or self-employed individual is qualified for housing loan. There are certain benchmarks set by housing finance companies and banks to make loans available to greater segment of the society known as “home loan eligibility” criteria.
Here are few aspects regarding your eligibility for housing finance:
Age
An age of the applicant plays a decisive role in qualifying for the loan amount. The age criteria for an eligible home loan applicant might differ on the basis of whether you’re salaried for self-employed. It is relatively proven if you’re younger and free from any responsibilities than you qualify for higher loan amount at lower interest rates costs.
Credit Score
It is important you have a good credit score rating to avail any form of loan. Before, lending finances banks have a background check of your credit history through a Credit Information Company like CIBIL (Credit Information Bureau India Ltd.) and go through your repayment track record. You can visit the government recognized site for www.cibil.com and get your credit report. The errors or low credit score might reduce your chances of getting higher home loan eligibility. Such reports are accessed by the bank’s credit department after you apply for the housing loan for inputs on your credit history.
Existing Liabilities
It refers to any other loan being currently repaid by you. Housing finance companies and banks operate as such that if you’re paying any other loan, then your ability to repay an additional loan will be adversely affected. You may not pay extra towards home loan and clear the debt as soon as possible. Therefore, you may have less disposable amount towards your housing loan.
Income Level and Number of Dependents
Obviously, your current income level, source of income play a key role in deciding your home loan eligibility. A high net monthly income which may incorporate your spouse income as well is indicative of an ability to pay a higher monthly installment and better chances of timely repayment of your loan amount.
Also, some housing finances companies and banks take into consideration the number of dependents on the borrower. More dependents could be considered as hindrances towards easy and higher loan repayment amount. It will adversely affect your installment paying capacity.
Almost, all housing finance companies and banks offer this beneficial tool of EMI calculator for its customers and it’s very easy to us. Calculating monthly EMI is now at the touch of the button on your computers, laptops or smartphone devices. All you need is just mention the loan amount, interest rate preferred and loan tenure and it will display you exactly how much monthly payment you’ll be paying.
For any loan amount the loan tenure, interest rates, monthly installment and the amortization schedule offered by banks & finance companies will almost be similar. Consumers should know that in the initial phase, the EMI’s contribute more towards payment of interest rates then clearing reducing the principal amount. Gradually, as the tenure progresses, EMIs’ will clear off the principal amount being offered to the borrower. Thus, after every successful monthly installment payment to the finance company or bank, you will get an inch closer to clear your debt and own your dream forever.
Property Status
Home loan India provides give top priority to borrowers who intend to buy a HFC or bank-approved property. In such cases, approvals for the loan are speedy and the interest rates are also comparatively low. The other facts would be the status of property such as resale, under construction or newly constructed.
To summarize we would insist home loan eligibility highly depends on the individual’s monthly income, sources of additional income, savings and credit history, work experience, age, qualification, number of dependents, other sources of income including spouse’s income and asset & liabilities. Also, the job consistency or business stability matters the most while getting qualified for loan amount.