Buying or building your home will be your longtime dream; what is stopping you now? Funds? – That’s why the home loan is for. You don’t have to worry about finances and can move on with your life with the best home loans. Most of the NBFCs and banks in India offer home loans for getting your dream home.
When you get a home loan, your financial stress will mostly diminish, but you should make sure to choose a financial provider who provides your best home loan which is customized to satisfy your home loan needs. Before getting a home loan, here are some important eligibility requirements which you should be aware of. The lender will access your credibility for repaying the loan amount within a fixed tenure under certain home loan eligibility criteria.
Home loan eligibility will be defined as the maximum loan amount, which you are eligible to get based on certain criteria which the financial provider has. Only when you fulfil those financial criteria like income, repayment capacity, age, credit score and many more, you will be eligible to get a home loan.
Here are certain important home loan eligibility requirements which you need to satisfy when you want your home loan to be approved:
Clear All Your Current Loans:
Your existing loans will create a negative impact on your home loan eligibility, so you should make sure to pay all your current loans before opting for a home loan. When you have a lot of previous dues, then the financial provider will think that you are not capable of repaying the loan on time, so they will be worried about providing you with another loan. Having a no-due certificate and getting the details updated in your credit score will make sure you are eligible for applying for a home loan.
The financial provider can access your home loan eligibility depending upon your repayment capacity. When compared to other loans, the EMIs on home loans will be higher to pay each month. When you choose a loan with a longer tenure at such situations, you will have to pay very low EMIs each month which can easily fit into your monthly budget.
Sometimes longer tenure leads to higher interest rates, so be ready to face situations like that. It is far better than when you default paying your loan and lose your credit score to a great extend. Also, you can consider increasing your EMIs each year when you feel your income will also grow periodically. You need to make sure you restrict your unwanted expenses when you want to get your home loan paid off with a short tenure. There are also many online calculators that help you to calculate your home loan EMI before applying for a home loan.
Have A Strong Credit Score:
Both banks and NBFCs consider your credit score to be an important factor accessing your repayment behaviour and assign you like the low or high-risk potential for opting for a home loan.
The CIBIL score is an important factor which will help the financial provider decide on if you fulfil the eligibility for the loan or not as it determines your repayment capacity. A credit score that is 750 or higher is considered to be a good credit score which will increase your home loan eligibility which will also help you in saving your interest rate to a great extend.
Choose For Joint Home Loan For Better Eligibility:
Sometimes low income, low credit score and other things like that will make your home loan get rejected by the financial providers. At times like that, you can choose to get a joint home loan with someone who has good eligibility criteria for getting your loan get approved easily.
When you want to get a home loan the only eligibility you will require is your co-applicant should be your immediate family member and should be salaried or self-employed with good credit ratings. Also, when you have a female co-applicant, it will be helpful as they get lower interest rates compared to you with certain useful schemes.
When you opt for a joint home loan, you will have higher chances of being eligible for a home loan as you will have higher eligibility criteria. Also, you can still enjoy the benefits like tax benefits, shared loan repayment and so on.
Additional Income Source:
When you have any additional income sources like rental income, fixed deposit interest earned or any other bonus received from your employer or a part of your freelance work. Then your eligibility will increase to a great level. As all these income methods will back you up, it will drastically increase your home loan eligibility criteria and let you buy or build your dream home.
Opt For Step-Up Loans:
Step-Up loans will be a better option for people when they have low monthly income and will have greater difficulty in managing with high loan EMIs along with their monthly expenses. With step-up loans, whoever might be your lender you can pay lower EMIs in the initial years of your loan and gradually increase it which will help you financially when you have existing loans to pay for a certain period.
You should thoroughly analyse all the requirements and eligibility criteria which the financial providers give and choose the financial provider who best suits you. Estimate your income, home loan budget, CIBIL score errors, loan options, interest rates and opt for the option which best suits your financial stability. When you make sure to follow all the above tips and choose the financial provider after thorough research, then there won’t be a problem for you to get your home loan approved. You should make sure to disclose all the details which the financial provider asks for without any errors. Any minute errors in your loan application will also make it get rejected, which will also impact to a greater extent in your credit score.