A Home Loan is the biggest responsibility that one can take in life. It is a secured long-term loan which you need to continue for 20-30 years. But, before you apply for a Home Loan, you should check how much amount you have to pay every month, that is your EMI. And you also need to check the Home Loan eligibility.
The steps to calculate the Home Loan eligibility are:
Step 1 – First factor is the income. Your monthly income is the most important factor for Housing Loan eligibility, because it decides the amount you can repay.
Lenders will consider all types of income such as salary income, income from business/profession, rental income, and interest income and then decide your repayment capability.
Step 2 - Lenders will check for a co-applicant. If you are taking a joint Home Loan and the co-applicant is an earning member, then it will be an added advantage for you.
Step 3 - Lenders will calculate your savings. Your lifestyle, saving habits, income, etc. will determine your savings. A person must have 30% of his/her income as savings.
Step 4 - Lenders will calculate the existing EMIs.. If you have an existing loan, the EMI of the existing loan is deducted from your savings and then your capability will be decided.
To know the next steps, read:
How the Lenders Calculate Home Loan Eligibility
Aman Khanna is an experienced financial advisor who is well known for his ability to foretell the market trends as well as for his financial astuteness. He has an MBA in finance from Toronto University as well as years of experience delivering seminars on sound financial practices and debt management.