Owning a house is a dream for several people. However, the high price of real estate can make it tricky to fulfil this wish without financial assistance. This is where a Home Loan comes into play. It is a Secured Loan you can apply for to buy a property by providing it as collateral. It is usually repaid using equated monthly instalments. However, most banks typically have specific eligibility requirements in place.
To successfully get a Home Loan, confirm your eligibility before submitting your application to the bank. This is when a Home Loan eligibility calculator helps. Let us understand it better and consider how to use it. Here are also other factors that affect Home Loan eligibility.
About Home Loan eligibility calculators
A Home Loan eligibility calculator lets you compute your eligibility online. It enables you to estimate the Loan amount for which you are eligible. This tool calculates your eligibility by evaluating specific financial details.
How to use a Home Loan eligibility calculator?
Today, like an online House Loan EMI calculator, you can use an eligibility calculator. Using this eligibility calculator is simple:
- Look for a reliable Home Loan eligibility calculator online.
- Once you find it, enter details like age, net monthly income, other EMI, and interest rate.
Once you enter this information, you learn about your Loan eligibility within seconds. This way, you can evaluate whether you qualify for the Loan amount you want.
Factors influencing Home Loan eligibility
The factors that affect Home Loan eligibility include:
- Employment and income stability
Banks usually want to ensure you have a stable income source to repay your Home Loan. A stable employment history and steady income stream can boost your possibility of getting Home Loan approval.
- Existing debt obligations
Multiple Loans and debts may not be an issue. However, unpaid dues are a concern for banks. They also assess your repayment pattern. Paying your monthly instalments after the due date, missing your EMIs regularly, etc., can cause concern. Hence, be disciplined about your credit repayment.
- Credit scores
Your credit score indicates your financial credibility. A good score shows your ability to handle credit responsibly and repay Loans on time. A score of 750 or above boosts your eligibility.
- Loan tenure
It is the duration within which you repay your Home Loan. Choosing a longer tenure results in affordable EMIs. However, this increases the overall interest costs. Conversely, shorter tenures result in higher EMIs. However, they decrease the interest burden. Hence, choose a tenure that balances eligibility and affordability.
Conclusion
Banks usually have specific criteria that you must meet to be eligible for a Home Loan. Today, you can easily use a Home Loan eligibility calculator to check your qualifications. You should also be equipped with the knowledge of the different factors that affect Loan eligibility.
