Understanding Home Loan Eligibility
Home loan eligibility depends on multiple factors including your income, existing financial obligations, credit history, and the property you're considering. Banks typically follow these guidelines:
How Lenders Evaluate Eligibility
- Income Assessment: Lenders typically allow 50-60% of your net monthly income (including co-applicant) to go towards loan EMIs, including existing obligations.
- FOIR (Fixed Obligation to Income Ratio): The sum of all your EMIs (including the proposed home loan) divided by your monthly income should ideally be below 50-55%.
- Loan-to-Value (LTV) Ratio: Banks typically finance 75-90% of the property value, requiring you to arrange the remaining amount as down payment.
- Credit Score: A good credit score (750+) increases your eligibility and may help secure better interest rates.
Factors that Affect Eligibility
| Factor |
Impact |
| Higher Income |
Increases eligibility |
| Longer Loan Tenure |
Increases eligibility (lower EMI) |
| Existing Loans/EMIs |
Decreases eligibility |
| Lower Interest Rate |
Increases eligibility |
| Co-applicant's Income |
Increases eligibility |
Note: This calculator provides an estimate based on general banking principles. Actual loan approval and amount may vary based on the lender's specific policies, your credit history, and other factors.