Factors that affect home loan eligibility | Fusion - WeRIndia

Factors that affect home loan eligibility

Factors That Affect Home Loan Eligibility

Normally, many people prefer to acquire their homes with a home loan. The tax benefit is one of the most important things for choosing a home loan.

And, another important thing is, acquiring a home needs a huge amount and that’s why a home loan is essential for people.

There are certain factors that affect your home loan eligibility. Read on to know about them.

Age is the first and foremost factor for the lender to offer a home loan to the borrower. The young borrowers in the age group of 20 to 30 years can avail a loan for a tenure of up to 25 years without any difficulty. But, if you are crossed 40 years, then it is tough to get your home loans. And, the applicants of aged above 50 will be denied home loans as a single applicant due to their age.

Income is another factor that affects your home loan eligibility. Whether you are a salaried employee or a self-employed person, you should have a regular income to get a loan. The salaried individuals should have to finish at least one-year of employment first before their submission of home loan application. Form 16, bank statement, employer reference letter etc. should have to be furnished. Professionals like doctors, engineers and management consultants should have to furnish their ITRs along with bank statements. Self-employed people including those have their own business should also submit their bank statements and income tax papers.

Your CIBIL score is another key factor that affects your home loan eligibility.

Home loan eligibility is inversely proportional to the rate of interest. If the rate of interest is more, then your eligibility would be less, and vice-versa.

The longer the tenure, the higher the eligibility would be. Yet, you have to pay more amount in the form of interest for a loan with longer term.

Normally, banks and other financial institutes lend amount considering EMI to income ratio in the range of 50 to 60 per cent. The existing loans if any would also affect your loan eligibility.

Image Credit: Nick Youngson CC BY-SA 3.0 Alpha Stock Images

Image Reference: https://www.thebluediamondgallery.com/wooden-tile/h/home-loan.html

Leave a Reply

Your email address will not be published.