Home Loan is one of the most popular products among customers. What is the reason behind it? Several people are unable to purchase their dream houses by paying the full amount in one installment. That’s why people take respite from a Home Loan provided by the lenders. One of the common questions among the borrowers is about the maximum home loan amount that they can get from lenders. To know the maximum eligible loan amount, there is this amazing tool known as Home Loan Eligibility Calculator.
Lenders generally have a fixed minimum and maximum loan amount for borrowers but the eligible loan amount depends on a lot of factors and tends to change from one borrower to another. This tool helps in having an early idea about the maximum loan amount an individual can get from a lender. When you have the maximum loan amount you can get, you can decide whether it would be a suitable choice for you not. In this article, we will cover everything related to the Home Loan eligibility calculator such as details needed to use this tool, factors affecting your home loan eligibility, etc. So, it could be a great read for you if you are going to opt for a home loan. Keep reading!
Details needed to use the Home Loan Eligibility Calculator
So, you must be thinking about what are the details that you will be needing to use the Home Loan Eligibility Calculator. Well, you only need a few basic details and you will get the results instantly with this efficient tool. These details are Monthly Gross Income, Tenure (in years), Home Loan Interest Rate and existing obligations (other EMIs).
As soon as you put these details into the calculator, you will get your home loan eligibility. The amount will be the maximum loan amount that you can get according to these details. Let’s understand this through an example.
Suppose an individual who has a monthly income of INR 50,000 wants to opt for a home loan of 20 years at an interest rate of 8.5% per annum. He has been also paying a personal loan EMI of INR 10,000. So what will be his maximum home loan amount?
On putting these details into the Home Loan Eligibility Calculator, the maximum loan amount this individual can get is INR 14,40,385. The Home Loan EMI for this amount will be around INR 12,500.
Factors Affecting Home Loan Eligibility
When any lender provides you the home loan, the lender checks several factors to estimate your eligibility. There are a number of factors that determine your home loan eligibility. We are showing all of them below. Please have a look.
Monthly Income:- An individual’s monthly income determines the repayment capacity of an individual. Because he or she must be repaying the loan amount from a portion of monthly income. It is one of the important factors that affect your home loan eligibility. An individual with a high income and fewer obligations can get a higher loan amount.
Property Location:- Lenders also check the location of your property for which you want a home loan. A property located at a prime location and all the amenities nearby can get you a high loan amount as compared to a property located at a remote location far from the city.
Existing Obligations:- If you are currently having some other loan/s, it can impact your home loan eligibility negatively. Because this simply means that you have a lesser repayment capacity so the loan amount will automatically be lower. It would be better for you to opt for a home loan after clearing off all your obligations.
Employment Type:- Your home loan eligibility also depends on your employment type. The eligibility of a salaried individual usually varies from that of a self-employed individual. Other than this, the interest rates could also be a bit higher for self-employed as compared to salaried people.