Financial organisations evaluate your creditworthiness based on several housing loan eligibility parameters to determine whether or not to provide you a house loan. Therefore, you can calculate it yourself using an online calculator if you intend to apply for a home loan. Your financial standing, age, debt obligation, credit history, and other factors will all affect your credit score.
Here are the is how you can check home loan eligibility based on your salary.
How to determine home loan eligibility?
Using an online calculator, you can quickly determine your eligibility for a house loan. Additionally, it reduces the chances of erroneous results generated by manual calculations. Furthermore, it enables you to determine your eligibility for a house loan by entering just a few parameters.
Here are the steps to calculate your housing loan eligibility in just a few clicks:
- Enter your date of birth in the format, DD/MM/YYYY.
- Following this, provide the residential and salary details in appropriate format.
- Provide the additional sources of income, if any.
- Feed in the ongoing EMIs, if any.
The online home loan eligibility calculator will use these data to determine how much amount you qualify for. Therefore, make sure the information you enter is entirely accurate. Let us now take a quick look at the factors influencing the eligibility requirements.
Factors that affect a home loan eligibility
By taking into account a number of factors, a financial institution determines your eligibility to know whether you can pay off a home loan in full or not.
Here are the six factors that affect the home loan eligibility:
- Applicant’s age: For salaried applicants, the age range should be between 23 and 62. For self-employed borrowers, it ranges from 25 to 70 years.
- Monthly income: Applicants must earn Rs. 25,000 per month in order to opt for a home loan.
- CIBIL score: The majority of financial institutions want at least a 750 CIBIL score. Therefore, if your score is below than this threshold, you can have to pay a large interest rate.
- Debt obligations: The sanction amount of a home loan will also depend on your financial obligations. This means that the lower your debt load, the greater the likelihood that your loan application will be accepted.
- Employment status: Another element affecting your eligibility is your employment status. For salaried employees, lending institutions require a minimum of three years of work experience, and for self-employed individuals, a minimum of five years of business history.
- LTV ratio and property details: Finally, you must provide information on the property valuation to obtain the approval from the lending institution. Keep in mind that the institutions will only offer 75% to 90% of the entire value of the house as a loan amount. Therefore, you must determine eligibility accordingly.
Further, several financial institutions extend pre-approved offers on secured loans, such as a home loan and loan against property. These offers expedite the entire home loan procedure and helps in fast disbursal of the loan amount. Existing customers can check their pre-approved offers by entering their names and contact details in the lender’s portal.
Hence, willing borrowers should check home loan eligibility before applying for this secured line of credit. This will help them know the exact amount they will be eligible for based on their financial standing and other factors. Further, applicants should make sure to fill in all the details in the home loan applicant form and not miss out any section to enjoy a seamless loan approval process.
