There is no doubt that the prices of real estate in India are touching the sky, especially after the Covid-19 outbreak. Due to this, purchasing a home is a tough call but not an impossible one. This is where a home loan comes into the game. Now, we all know that to get a home loan, one needs to first check housing loan eligibility, as there are certain checkpoints which need to be cleared before you actually get a loan.
India’s high real estate cost leaves an individual with no other option than a home loan. In simple terms, it is a loan taken to purchase a residential or commercial property.
What is a home loan?
It is a secured loan where you have to mortgage your property to your lender. You have to pay a portion of the principal amount and interest through equated monthly instalments (EMIs). Also, keep in mind that both the principal amount and interest qualify for a tax deduction. So, when you go for a home loan, you gain complete property ownership at the end of the loan tenure.
Remember, before opting for a home loan, it is important to check your eligibility via a housing loan eligibility calculator.
What is housing loan eligibility?
It is a set of criteria basis where a financial institution assesses whether the customer is creditworthy or not to avail and repay a loan. The two main factors of home loan eligibility are income and repayment capacity of the borrower. However, other factors include age, financial position, credit score, etc.
What factors affect your housing loan?
There are certain factors that affect its eligibility, and it is vital to keep them in mind. Moreover, using a housing loan eligibility calculator is always advantageous to ensure you walk on the right track. From employment status to income, there are many factors.
1. Employment status
Employment status also plays an essential role when looking for a home loan. If you are employed with a reputed company or are a self-employed individual with a stable income, it makes you more reliable as a borrower. On the other hand, if you have an unstable job, then the chances of getting a loan is low.
2. Credit history
It can be a hurdle if you don’t have any credit history. With no credit history, the lender will have no reference point to use while analyzing the credit conduct.
Another factor affecting housing loan eligibility is income. As there is no collateral here, financial institutions want to know that you have a good income from your job and other sources that allow smooth monthly payments.
Financial institutions will most likely grant you a home loan if you are young. This is because they look for borrowers who can repay the loan amount satisfactorily before the retirement age, which is generally 60 years.
How to check your eligibility?
Instead of getting into complex solutions, I’ll share my personal experience here. Please don’t consider this write-up a promotional one, as I’m just trying to make it easy for the readers. I’ve been using the Bajaj Finserv application for quite a long time now for all kinds of recharges. In this app only, I came across the housing loan eligibility calculator.
So, if you are planning to go for a home loan, don’t forget to check your eligibility which includes certain factors such as monthly income, age etc.