Many people avail of home loans to build their dream homes. With the help of a home loan, this dream can be achieved. The process of availing of a home loan is quite simple. It is also essential to understand…
Many people avail of home loans to build their dream homes. With the help of a home loan, this dream can be achieved. The process of availing of a home loan is quite simple. It is also essential to understand all the information about a home loan before applying for one. Let us look at the factors that affect a home loan and how you can check your home loan eligibility with a co-applicant, credit score, and existing loan.
Factors Affecting Home Loan
5 main factors affect a home loan. Let us have a look at each of them.
To apply for a home loan, age is one of the most critical factors considered. The minimum age is 18 years, and the maximum period is 70 years of age. Typically, younger individuals are offered a longer tenure compared to older individuals.
If you opt for a longer tenure, you will be considered more eligible for the loan. Choosing a more extended repayment period reduces the monthly EMI to be paid.
Generally, individuals are categorized as self-employed or salaried individuals.
4. Credit Score
The credit score is a very crucial aspect when it comes to availing of a home loan. It is recommended to have a credit score above 700 to stay on the safe side. Your credit score represents your creditworthiness.
If you have any outstanding debt, you will be assessed based on the amount of outstanding debt you have. It is recommended to have a debt-to-income ratio of 40:60.
How to Check Your Home Loan Eligibility?
One of the main parameters that your home loan is based on is your income and your loan repayment capacity. In addition to this, other factors determine your eligibility, such as interest rate, credit score, spouse’s age, existing loans, tenure, and others. The other loans you have availed such as a car loan or a personal loan can also affect your eligibility for a home loan.
All the banks and lending institutions check for applicants’ credit scores to assess their creditworthiness. By gauging many factors, banks and NBFCs approve or decline a home loan to applicants. If you would like to improve your home loan eligibility, let us look at how you can do the same.
1. Increase the Tenure
One of the most straightforward ways to enhance your eligibility for a home loan is to increase your tenure. You would have to pay lower EMI over a more extended period with a higher term.
2. Add a Co-Applicant
Adding a co-applicant can increase the loan amount eligibility. Co-applicants can be parents, siblings, or spouses and should be salaried individuals.
3. Look for Lower Interest Rates
A lower interest rate can help you improve your eligibility for a home loan as it would require lesser repayment from your side.
In a Nutshell
There are ways to improve your eligibility for a home loan. You can avail of a home loan from Finserv MARKETS and experience benefits like quick disbursal and minimal documentation. You can also use the home loan eligibility calculator to calculate your eligibility.