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What is Home Loan Eligibility

  • 14-Mar-2022
What is Home Loan Eligibility

A home loan is a secured loan. It is provided to purchase a new or pre-owned home. It is provided by various banks, financial bodies, or NBFCs.

Self-employed eligible for a home loan 

  •  The Age limit for the self-employed applicant is between 21 to 65 years of age. 
  • The Minimum salary should be Rs. 10,000 per month. 
  • The Minimum business income should be Rs. 2 lakhs per annum. 
  • The maximum loan tenure is 30 years. 
  • The present and future income of an individual is crucial for evaluating the amount of loan. 
  • Present and past CIBIL Score & Credit history records should be positive. 
  • Financial obligations such as credit card debt, car loans, etc. 

Salaried Individual eligible for Home Loan 

Salaried individuals are offered a home loan from several Banks, Financial bodies, or NBFCs. 

  • The age limit of the salaried applicant should be 23 to 62 years. 
  • Work experience of salaried individuals is of a minimum of three years. 
  • CIBIL Score must be above 750. 
  • The minimum salary should be 25,000/- 

Professional eligible for a home loan 

Professionals such as architects, Cost accountants, Dentists, Engineers, Chartered Accountants, Management Consultants, Doctors, etc. are eligible for the home loan criteria. 

At the time of home loan initiation, borrowers above 21 years of age and up to 65 years of age can pledge for a home loan. 

Home Loan Eligibility Calculator 

Home loan eligibility is calculated after various factors such as Current age, CIBIL Score, Monthly Income, Credit history, Current age, fixed monthly financial obligations, Age of retirement, loan repayment tenure, other sources of income, etc. It should also be considered as home loan affordability. Using a calculator is the easiest way to evaluate a home loan eligibility. 

How is Home Loan Eligibility Calculated? 

An applicant can check eligibility within a couple of seconds and get an idea to meet the amount of home loan requirements. 

The borrower can check their eligibility easily with the help of a home loan eligibility calculator. Given below are the steps of using the home loan eligibility calculator. 

  • Enter net monthly income 
  • Enter loan tenure  
  • Enter the rate of interest 
  • Then, enter any other existing EMIs. 

Home Loan eligibility on Salary 

The net monthly income evaluates the service capacity of a home loan. Given below are some illustrations of eligibility for loan amount for different income and tenure as follows: 

Note - Consider the rate of interest is at 7.00% 

Home loan eligible amount Net Monthly Income (in Rs.) 
Tenure  25,000 – 35,000 35,000 – 45,000 45,000 – 55,000 
5 years 5,05,020 7,95,406 10,22,665 
10 years 8,61,264 13,56,490 17,44,059 
15 years 11,12,560 17,52,281 22,52,933 
20 years 12,89,825 20,31,474 26,11,896 
25 years  14,14,869 22,28,419 28,65,110 
30 years 15,03,076 23,67,344 30,43,728 

Factors that Affect Home Loan Eligibility? 

Home loan eligibility criteria are evaluated by the Banks or lenders based on: 

  • Age criteria: The age plays a vital role in the eligibility of a home loan for evaluating your tenure that determines your tenure of the loan which turns in home loan EMI. As long as the tenure, the less will be the EMI, and vice-versa to a given rate of interest and loan amount. 
  • No. Of existing loans:  If the borrower has many existing loans, the possibility of approving the loan by the lenders is less. Through this bank evaluate that the debt is high and banks determine that you are a needy borrower. 
  • Repayment: The primary factor that the bank determines is whether you are able to repay it or not. It depends on your means of revenue and income. 
  • Professional experience:  Professional record is also one of the main factors that affect the eligibility of the home loan. It aids to work in your Favour during the sanctioning of your home loan. 
  • Nature of employment: Eligibility criteria are different for different jobs. The eligibility criteria for a home loan of salaried applicants differs from self-employed individuals. Your monthly income evaluated the amount of your EMI or Equated Monthly Installment. And figure out whether you are eligible or not. 

Financeseva allows you to compare the best deal with the help of a home loan eligibility calculator. 

Also read: - Home Loan Eligibility Calculator

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