Not everyone who applies for a home loan is eligible to get approved for one. No matter how easy it might seem, getting your home loan approved is not a walk in the park because it requires careful research and acquiring thorough knowledge about the home loan, home loan interest rate, and other factors. Thus, before you apply for a home loan, check whether you are eligible for one.
Some of the factors that you should consider to check your home loan eligibility are:
- The applicant needs to be in the age bracket of 18-65.
- The minimum salary of the applicant needs to be INR 25,000.
- Salaried and self-employed people can apply for the home loan.
- The credit score of the applicant needs to be above 750.
- The type of property changes home loan eligibility.
- If the applicant is self-employed, they need work experience of a minimum of 3 years and if the applicant is salaried, their work experience should be at least 2 years.
- If the applicant is self-employed or salaried, they do not need a co-applicant.
Some other factors that determine home loan eligibility are good repayment history, stable income and financial past, fewer dependents, no credit card dues, and if the co-applicant is working.
Now that you know what the factors that affect your home loan eligibility are. Here’s how to boost your home loan eligibility!
- Improve your credit score- Credit score or CIBIL score is very important when it comes to the decision whether your home loan will be approved or not and what the amount will be. If your credit score is more than 750, then your chances of getting approved will increase because the lenders consider you as risk-free borrower and the home loan interest rate will go down.
- Try getting a longer tenure- If you increase the tenure of the loan, then you have more time to pay off the loan. This will lead to an increase in your home loan eligibility because the bank or non-banking financial company (NBFC) will be reassured because you have additional time to pay it off. It also results in a payment made timely.
- Make your spouse your co-applicant- If you have a spouse that is salaried or one who has a strong credit report, then make them the co-applicant in your home loan which might increase your chances of the bank or non-banking financial company (NBFC) sanctioning a higher loan amount. If there is a co-applicant, then the ability to afford the EMI increases because of double incomes.
- Open an account with the lender you choose to get the home loan from- Once you have done your research and compared home loan interest rates and chosen a lender, open up an account with them at least a year before you take the home loan. Whenever you ask for a loan, you will be preferred over other customers who do not have an account with that lender.
- Do not be impatient- This is the most important way to improve your home loan eligibility. Being impatient is not going to get you anywhere. Only through proper research, budget estimation, checking your credit score, etc., will you be ready to take out a home loan.
Taking a home loan is a once in a lifetime decision. Thus, if you keep these tips in mind, you will be able to increase your home loan eligibility and help you buy the home of your dreams!