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Home Loan Eligibility

Are you searching for a housing loan in India? Well, if that’s the case, then you need to take into consideration innumerable criteria in order to avail a home loan. In general, home loan eligibility (for Indians) is based on the repayment potential of the applicant. The maximum loan amount that is sanctioned differs from one bank to the other and usually the amount granted is somewhere between 80-85% of the overall cost of the house. Let us now take into account the home loan eligibility criteria for Indians.

  1. The financial stability of the applicant is the first factor that is taken into consideration. Financial profile comprises of other details on assets, past loan records (if any) together with a couple of investment details.
  2. The next factor that is taken into consideration is the monthly income of the applicant. In fact, monthly incomes are considered to be a viable factor that will help you get a home loan. In other words, it helps determine the capacity of your installments payment. In general, an applicant has to pay thirty to forty percent of this monthly income as the installment. This percentage can also come down if you have other installments or loans. For example, if you need to pay TV installments or vehicle loan then the eligibility for home loan gradually comes down.
  3. The applicant as well as the co-applicant needs to submit his or her professional details as well. The bank takes into account what profession you belong to so as to determine whether you will be able to pay the installments comfortably or not. In general, they are keener to provide the loan to people engaged in an organization over the business class.
  4. Age is yet another factor that needs to be taken into account when it comes to availing a home loan. To be more specific, the applicant should be too old or too young for the loan. The minimum age limit for availing a home loan is twenty one years and the maximum age limit for the same is fifty eight years.
  5. Property value is perhaps the most influential of all factors that will help you get the loan. It decides the maximum loan amount which a specific property can have irrespective of the loan limit eligible for the applicant. In general, this amount is somewhere between 70-90% of the overall property value.

The Eligibility criteria of NRIs differ from Resident Indians based on a few parameters. The parameters in which Eligibility criteria for NRIs differ from Resident Indians include:
  1. Age
  2. Qualification
  3. Income
  4. Payment options
  5. Number of dependants

The NRI Home loan seeker has to be 21 years of age and a graduate. The loan applicant has to have a minimum monthly income of $ 2,000.The Eligibility is also determined by the stability and continuity of the loan seeker's employment or business. The NRI also has to route his EMI, Equated Monthly Installments cheques through his NRE, Non-Residential External or NRO, Non-Resident Ordinary account. He cannot make payments from another source like, his savings account in India. The Eligibility of the applicant is also determined by the number of dependents, assets and liabilities.

An NRI applicant is eligible to get a home loan ranging from a minimum of Rs 5 lakhs to a maximum of Rs 1 crore, based on the repayment capacity and the cost of the property, which although is variable by the priorities of the home loan provider.

Home Loan Tenure for NRIs is different from Resident Indians. An applicant will be eligible for a maximum of 85% of the cost of the property or the cost of construction as applicable and 75% of the cost of land in case of purchase of land, based on the repayment capacity of the borrower. A NRI can enhance his loan Eligibility by applying for home loans with a co-applicant who has a separate source of income.

Now that the home loan eligibility (for Indians and NRI) is clear to you, make sure to start off with your planning soon!
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