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3 Ways To Increase Your Loan Eligibility

By Author: Aishwarya Mahurkar
Total Articles: 291

Owning a home is of paramount importance for safety and security issues. Thus applying for a home loan is an important and a difficult process. Getting a home loan is not an easy task, so it is essential that you understand the criteria for home loan application and how to go about the process - to ascertain that your application is accepted. Since it is a complicated process, it is recommended to use a home loan eligibility calculator when applying for a loan. This tool takes into account details such as your monthly income, your current EMIs, interest rate, tenure, employment status, the age of the applicant and his or her retirement age as well as gives accurate result on your loan eligibility.

It is obvious that, not everybody is eligible to apply for a home loan. There are certain factors, which augment the eligibility of loan applicants. Those factors are as follows:-

Steady Income

The bank which is lending the money wants a full repayment on the loan amount plus interest. For this reason, they see your monthly or annual income to predict the chances of full reimbursement. Thus, it is extremely important that you have a well paid job. Most importantly, your job should be stable and steady. In case, you are a salaried individual and another member of the family (such as your spouse) will be contributing partially to the EMI; it is important that you combine that person’s income in the form to increase your chances of success.

This is one of the main reasons why banks reject loan applicants above the age of 60. This is because after retirement their income will stop and they will be unable to pay their EMIs regularly. At the same time, they don’t accept applicants who are extremely young because they will fail to provide valid income proof for the past 3 years. Thus, a steady monthly income will boost the chances of your loan being accepted.

Down Payment

Home loans are secure loans and initial payment on the loan amount is mandatory. You should use a home loan eligibility calculator to calculate all aspects of the loan including the down payment demanded by the bank. The down payment is usually 10% -20% of the loan amount but it differs from lender to lender.

Credit score

The banks frequently refer to your credit score before accepting or rejecting your loan application. The chances of your loan application being accepted are higher if your credit score is high. Your credit cards are an important part of your credit score. The more the cards, the lesser the credit scores - your credit card expenses are a monthly loan provided by the bank.

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 calculators that help to make the best decision.

Total Views: 119Word Count: 503See All articles From Author

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