Are you looking to buy your dream home using the housing finance facility?
If yes, then you need to understand that you would need to undergo lots of arrangements in your budget. It is because a home loan comes with longer tenure and it can affect your income for long.
But before making an adjustment in your expenses to make way for the EMI, you would need to ensure that you have the required home loan eligibility.
Yes, when you apply for the loan, then the lender will check out your home loan eligibility. It is the final loan amount that you can get and is dependent on factors like your credit score, income level, repayment history and more.
In today’s post that you are going to go through, we will talk about vital parameters that can help you enhance your home loan eligibility easily. Ensure to read on till the end!
- Check and maintain a higher cibil score
Be it the secured or unsecured debt, your lender will always check your cibil score to assess your home loan eligibility. And to do that, they will pull out your credit score. If you have a strong cibil score, then you may get the approval fast and for a bigger amount. You may also enjoy a lower home loan interest rate in reward for your timely repayments so far. In case if your credit score is poor, then either your home loan may be rejected or you may be charged with a higher rate of interest. You can maintain a robust cibil score by making timely repayments toward your debts and credit card outstanding.
Try clearing off your entire debt
If you apply for the home loan with some debts, then it will surely have a negative impact on the home loan eligibility. The lender will consider that your debt to income ratio is higher and it may not approve the request. Even if it does, it may not be for a higher amount. Thus, try paying off your existing debt to get the home loan eligibility for a significant amount.
- Opt for a longer home loan tenure
If you go for longer loan tenure, then it means that you need to manage to pay reduced EMIs. And it may be suitable for middle and lower-middle-class applicants. However, if you do that, then you may also have to pay more as the loan interest. And it can lead to an increase in the overall cost of the loan. But you don’t need to worry. Your income will keep on increasing every year. And you can increase the EMI amount and make some prepayments if you receive some bonus/increments. All that you would need to do is – manage to restrict your expenditures a bit. It will also help you repay the home loan faster. You can know your home loan EMI amount by using the home loan EMI calculator on a lender’s platform as per your tenure and more.
- Go for a joint home loan
Your home loan application may be rejected if your credit score and your income are lower. If you want to boost your home loan eligibility, then you can do that with your spouse as the co-applicant instead of applying as an individual. If your co-applicant happens to be a woman, then you can enjoy discounts on loan rates. Even if the interest discount happens to be around 5%, then it means that you can save thousands on repayments.
If you are also failing to fulfil the home loan eligibility, then you can also consider your other sources of income like the rental money, FD ROI and more. All these can help you enhance the home loan eligibility by a distance and you may get the approval fast.
By considering these vital tips, you can surely help yourself improve the home loan eligibility and avail a large amount and buy your dream home.