Home loan is a conventional credit option for individuals looking to avail substantial funds to purchase a residence or to construct one. In recent times, its affordable interest rate has made this loan variant the perfect financial choice for first time home buyers.
However, the applicants need to fulfil specific home loan eligibility criteria to avail the funds without hassle. This is a vital step for a financial institution since it ascertains borrowers' creditworthiness and reduces the lending risk.
Hence, checking the updated list of eligibility parameters of a preferred lending institution is crucial.
What are the eligibility criteria for a home loan?
Generally, lending institutions lay down different home loan eligibility criteria for self-employed and salaried applicants. These criteria are based on an individual's capability to repay the outstanding loan amount on time.
Salaried individuals
Home loan eligibility criteria for salaried individuals are as follows -
Applicants must be aged between 23 to 62 years.
They should have a credit score of 750 and above.
He/she must maintain a remarkable credit history.
Should have a stable income flow with 3 years of work experience.
He/she must earn a minimum salary as specified by the lending institution.
Self-employed individuals
Housing loan eligibility criteria for self-employed individuals are -
Applicants must be aged between 25 to 70 years.
Their business should have a minimum vintage of 5 years.
He/she must be an Indian resident.
The self-employed applicant must also have a good credit history and a 750+ CIBIL score.
After complying with these criteria, individuals can determine the amount they are eligible to borrow by using an online home loan eligibility calculator.
However, one must be aware of certain factors that can improve the home loan eligibility criteria to avail better interest rates. They must also keep the necessary documents handy to hasten the loan application process further.
Read Also: Increase You Home Loan Eligibility: 5 Points to consider
