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Age Advantage – Does Your Age Matter When Applying For A Home Loan?
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Home loans tend of be a loan term in nature and require the borrower to pay bank the banks for several years. It is for this reason that both age and income of the applicant play a huge role when a bank considers their home loan application. Even if an applicant who has a high income level if he is older in age, the loan amount he may will eligible for will be lower. You can check your eligibility using home loan eligibility calculator. The reason why this occurs is that the bank may be worried that you may not be able to continue work as you get older, causing the income to reduce and hence making it difficult for the bank to get back the money they loaned. Thus it is easier for younger loan applicants to obtain home loans for tenures such as 20 years as compared to those closer to the retirement age. A long tenure is usually desired because it makes the EMI payments each month a lesser burden on the borrower. It also allows one to apply for a higher loan amount.
There are however a few steps that applicants who are older in age can take to get their home loan application approved:
• Age is not the only factor that a bank considers when looking at a home loan application. An applicant can use other methods to improve their eligibility. Since past loans can affect an applicant’s credit score, one should try to pay off all their old loans before applying for a new one. This will help improve one’s credit score and increase their chances of getting their application approved.
• If you are earning a high salary, you can use that to your advantage. If you are able to convince the bank that you will be able to repay the high loan amount, your application can be approved. One can also opt for a loan for a shorter tenure making it easier for the bank to approve it. If the applicant earns such a high income, the shorter tenure should not affect them.
• An applicant can also get a younger family member as a co-borrower for the loan. A borrower who is of a higher age can use this to boost their eligibility for a home loan. Most banks provide a higher cut-off for the age limit when a younger co-borrower is present. This allows an applicant to obtain a higher loan amount for a longer tenure.
Home loan applicants who are older must not be disheartened. They can still get the loan amount they wish if they follow the above steps. Also, older applications tend to have a higher creditworthiness which is appealing to banks. This can be used to one’s advantage to get the loan they desire.
Author Bio :
The author is a seasoned writer on finance topics and she articulates aspects that are important to people availing the home loan facility. She writes about a variety of topics covering the home loan documents, rates & the uses of home loan eligibility calculator that help to make the best decision.
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