Get the Knowledge on Home Loan Eligibility Criteria

Today, buying a home is a dream of every person. Sometimes person do not have the cash to buy an expensive house. In that case, several banks and lending institutions provides 

home loan to the needy persons.  In India, it is not easy to acquire a home loan. Person has to satisfy various home loan eligibility criteria for availing the loan. There are various criteria of getting a loan are as follows:

 Financial status of the person

The amount of loan depends upon the paying ability of the borrower and the co-borrower. Financial status means the savings of the borrower, collateral and working details of the customer.

Income of the person

Banks consider up to 50% of the monthly income of all borrowers for the EMI amount while deciding for the loan amount. This percentage decrease if a person has other obligation to meet from his monthly income. These obligations decrease the loan amount of the borrower. Therefore, person can clear all the debts, before applying for home loan. In this way, person can get a maximum loan amount. 

Home loan  interest rates depend upon the loan amount.

Applicants Profession

Bank also checks the stability of the person in their profession. It means the person is a regular earner or, he or she is working in a company for last 3 years and more. Salary of the person is deposited on the same account. This shows the repaying capacity of the person. Banks prefer salaried persons more than the business persons.

Age of the customer

The age of the borrower plays an essential role while deciding the home loan amount. The minimum age of the applicant is 21 years, and maximum age of the person at the loan maturity is 65 years.

Value of the property

Bank can provide a loan amount up to 85% of the market cost of the property/house/land/home. The remaining 15% value of the home is paid by the borrower as down payment. It is because bank wants to reduce the risk of lending the home loan amount.

Credit score

Bank checks the credit score of the person. If a person has a clear credit record then, person can get a loan at the best interest rates. If a person has a poor credit score then, person can get a loan at the highest interest rates. Bank requires some documents for home loan such as Employment proof, Income proof, Age proof, Salary slips and Bank statements. Bank verifies these documents and then approves the loan. Money gets disbursed into the customer’s account within 48 hours.