123ArticleOnline Logo
Welcome to 123ArticleOnline.com!

ALL >> Investing---Finance >> View Article

Factors That Determine Your Eligibility For A Home Loan

By Author: Neha Sharma
Total Articles: 973

When it comes to purchasing a home, there are plenty of options you can consider to finance this purchase. Amongst the several options, the home loan is one of the most popular choices. Not only are there several lenders who offer home loan in India, but they also offer it at different competitive rates.
However, each lender will have different criteria for evaluating a loan application. These criteria determines your eligibility for a loan application. Here are a few factors that almost all lenders will consider:

Disposable income: One of the most important factors that a lender will consider is your disposable income. It is derived by deducting your statutory deductions, regular expenses and existing EMI’s from your overall gross income. Overall, you home loan EMI should be within 40% of your monthly disposable income. If you individual income is low, you can always apply with a co – applicant to increase the overall gross income in order to get the loan amount you require.

Credit history: Your credit score determines your creditworthiness. Lenders consider your credit score as the means to judge your creditworthiness. A low credit score will indicate that you are a risky investment. It also indicates that you may have a current debt value that you need to pay off before applying for another debt, such as the home loan. The appropriate credit score of 750 and above is considered as a good score. However, other lenders may have different scoring patterns and a fixed yardstick for their own version of their acceptable good credit score.

Compliance with legal norms: When it comes to opting for any of the home loan in India, lenders will first verify details of the property which you are taking the loan. They provide loans to facilitate the purchase of properties that have been legally cleared by the local authorities, especially if they possess a clear and valid title. Some lenders even offer special loan packages or rates on properties that have been listed in their approved database of properties.

Occupation stability and continuity: A stable job or income source ensures a continuous and steady income. This income in turn, ensures that the borrowed funds are repaid in a timely fashion. Lenders for certain signs and factors that indicate a stable job or income source. They also consider how long you have been working with your present employer to calculate how steady you are in your employment. Switching too many jobs during your career will create a negative impression. Additionally, lenders give more preference to government employees over professional individuals in private sector companies.

Apart from the above mentioned factors, there are plenty more, that a lender will review. Keeping these factors in mind will go a long way to ensure that not only do you get the ideal loan rates in the market, but also allows you to negotiate for the best rates in the market.


Author Bio :- Neha Sharma is a finance student who loves to write in her free time. She has spent considerable time researching about the home loan especially the home loan in India. Through her work, she provides valuable information on factors that determine your eligibility for a home loan.

Total Views: 52Word Count: 536See All articles From Author

Investing / Finance Articles

1. How Benchmarking In A Business Helps In Reducing Labour Hire Costs
Author: Dylan Munro

2. India Inc May Need To Change Rating Agencies Every 3 Years
Author: Suraj Pratap Malik

3. Bitcoin Workshop | Bitcoin Seminar | How To Buy Bitcoins
Author: AB Web Technologies

4. Online Financing - The Modern Way Of Investment
Author: wealthcarreindia

5. Selling Assets Versus Sme Loans: Which Is The Better Option?
Author: Manish Damani

6. Equity Research Report
Author: Chetan Rathod

7. Personal Loan Calculators Explained
Author: Arwind Sharma

8. Importance Of Having A Bank Account In The Digital World Today
Author: Sushant Singh

9. Step By Step Guide To Gst Registration Of Your Business
Author: Amol Kale

10. Forex Trading Techniques And Strategies For Beginners In Forex Market
Author: Sophia Mason

11. Are Tax Accountants The Most Important Hires For Your Small Business?
Author: John Panayis

12. Personal Loans - All You Wanted To Know
Author: bookmypersonalloan

13. How To Ensure Your Internet Banking Is As Safe As Traditional Banking?
Author: Neha Sharma

14. How Can A Bank App Help You Safely Execute Your Financial Transactions?
Author: Neha Sharma

15. Virtual Banking: Evolution Of Traditional Banking And How You Can Benefit From It
Author: Neha Sharma

Login To Account
Login Email:
Password:
Forgot Password?
New User?
Sign Up Newsletter
Email Address: