Home Loan Eligibility - Compare Top 10 Home Loan Lenders Eligibility

Salaried applicants need to satisfy the following home loan eligibility criteria.

Self-employed applicants need to satisfy the following home loan eligibility criteria.

Every bank that offers loan will look into many criteria prior to sanctioning it. Among the long list of factors, few important ones are:

• Employment Stability: It’s a crucial aspect for home loan consideration. Unless the applicant is salaried and employed for at least 2 years in the current profession or if the applicant is self-employed with minimum 5 years of total earnings loan will not be processed.
• Age Criteria: The younger the applicant is there is more probability of getting loan. Most banks offer home loan for salaried employees only if they are between the age group of 20 to 60 years. However for self-employed this will change to 24 to 65 years.
• Credit Rating: Apart from the applicant’s company’s performance, individual credit rating has a lot of importance. Good credit rating will increases the chance of getting the loan with more flexibility on loan amount, EMI, tenure and interest rates. Default payment records, fraudulent tracks, and outstanding loan, will reflect negatively on the applicant, this could lead to bank’s cancelling the loan request or will charge high rate of interest.
• Employer: If the applicant is working with an employer who has high reputation and impressive turnover, the credibility of the applicant will respectively increase. Being a part of reputed and high turnover companies is an asset for the applicant especially when it comes to applying for home loan.
• Financial Situation: For this factor, not just present status is considered, the past records of financial stability holds lot of value in deciding the eligibility for home loan. It is a key to success in all fields if you have good financial records, this can decide the interest rate percentage, loan amount and tenure when applying for loan.

There is no doubt, at the beginning every bank says it can offer 30 times of your net income, this makes the applicant exciting. But when loan is being processed, things change. The eligible loan amount will fall; too many other criteria will have a call on the loan amount and interest rate decision. It is advisable to be aware of how banks calculate home loan eligibility. Nothing is rocket science, it’s all merely Maths calculation and here it goes. Net income is the total of Basic salary, HRA (House rent allowance), Medical allowance, LTA (Leave travel allowance), Performance bonus, Special allowance, Conveyance allowance, PF, Food coupons, and any other allowance. But only few of these are considered when it comes to home loan net income calculation. This is the first and basic reason things change while loan is getting processed.

Banks exclude LTA and medical allowance while calculating net income. Thus the calculation is Net income minus (LTA+ medical allowances amount) = New net pay. The other expenses to be considered while purchasing a house through loan are the sources of fund for stamp duty and registration charge. It is essential to be mindful that this charge is calculated on the super built up area and not-built up area.

To put this into few simple steps:

Step 1: Bank will look into your salary slips and banks statements to calculate the income level
Step 2: It then calculates the amount that is saved, bank usually assumes 30% of your income as savings, say your income is ₹50,000, and then saving is ₹15,000.
Step 3: If there are existing loans EMIs it will be reduced from the income
Step 4: Banks do a backward calculation to understand how much loan amount can be offered according to the saving amount determined

The top 3 banks that offer home loan in India are SBI, ICICI and Axis. Loan eligibility criteria for each of these providers differ according to various factors. Some of these criteria are listed below:

SBI offers home loan only post thorough scrutiny of the applicant’s request. It has fast approval processes with minimal and easy documentation. The list for the same is here:

Eligibility Criteria:

If you are looking for a bank that offers fast service with less interest rate, this is the best option. It is very transparent and flexible in its eligibility criteria.

Eligibility Criteria:

Citi bank offers the home loan at very competitive interest rate. They have 24*7 customer support for the assistance of home loan. Online application option is also available.

Eligibility Criteria:

• The age of applicant should be of at least 23 years. The maximum limit of the age is 65 years.
• The salaried applicant should be working in a reputed private company or a government company. Minimum work experience for the salaried applicant is 2 years.
• Last 2 years Income tax returns should be filed by the applicant.

Documents Required:

• Proof of identity (passport/ voter’s ID/ driving license/ PAN card/ Aadhar card).
• Proof of address (latest utility bill/ ration card/passport).
• Proof of income (Salary slip of last 6 months, 6 months bank statement, form 16 of current year).

HDFC bank is a global bank with the headquarters in Mumbai. The bank has been ranked in the top 100 Most Valuable Global Brands. HDFC is trusted name amongst the customers. The bank offers variety of home loans like new home loans, resale home loans & loans for constructing the home. HDFC offers the home loan with no hidden charges.

Eligibility Criteria:

• The minimum age of the applicant should be at least 24 years. The maximum age of the applicant can be 65 years in case of self- employed. The maximum age limit for salaried is 60 years.
• A salaried applicant should have at least two years of work experience. A self-employed applicant should have 4 years of work experience with good turnover.
• CIBIL score of the applicant should be above 750.

Documents Required:

The bank is providing affordable home loan & the customer service is commendable. The repayment tenure of Indusland bank is quite wide compare to other banks & financial institutes.

Eligibility Criteria:

• The maximum loan amount offered would not exceed 80% market value of the property
• The applicant should be either a salaried person or a self-employed with the regular income earnings
• A salaried applicant must have at least two years of work experience.
• The tenure of re payment of the loan depends upon the age of applicant
• Maximum age limit is 70 years for self-employed & 60 years for salaried person.

Documents Required:

The process of home loan application is easy & hassle free when it comes to Kotak Mahindra bank. Approval of the loan is simple & loan amount can be disburse in 4-5 days. Online application option is also available.

Eligibility Criteria

Documents Required:

PNB has the housing finance section that caters to variety of needs when it comes to home loan. The name of the brand itself is a great proof of its expertise in housing finance. PNB has many different types of loan option available when it comes to home loan like home purchase loan, home construction loan, home extension loan, home improvement loan, home loans for NRIs etc.

Eligibility Criteria:

• The applicant should be either a salaried person or a self-employed with the regular income earnings
• A salaried applicant must have at least two years of work experience.
• Maximum age limit is 70 years at the time of maturity of the loan.

Documents Required:

Standard chartered is a global bank with the branches in 70 different countries across the globe. If you are looking forward for low finance home loan with less processing charges than this is one if definitely for you.

Eligibility Criteria:

• The minimum age of the applicant should be at least 21 years. The maximum age of the applicant can be 60 years.
• An applicant must have at least two years of work experience
• Annual salary of the salaried applicant should be at least ₹480,000. Minimum yearly earnings in case of self-employed should be at least ₹600,000.

Documents Required:

TATA capital is known to provide customize home loans to their customers depending upon the need of the customers. They have number of home loans including the home loan, home construction loan, home renovation loan etc. the range of repayment tenure is as wide as 30 years.

Eligibility Criteria:

• The applicant must be a citizen of India.
• The minimum age of the applicant should be at least 24 years. The maximum age of the applicant can be 65 years of age.

Documents Required:

• Identify credit score reductions reason, it could be because of credit card late payments or loan EMIs defaults, etc. Defaulting and late payment is the core factor for bad credit scores thus it is essential that every individual should maintain a good track record.
• Never default payments in future. Make all payments on time and keep sufficient balance in your bank account for ECS transactions.
• Continuous rejection of Credit cards and personal loans will lead to drop in the CIBIL scoring, at these situations give it a break. This will help in gradually increasing the credit worthiness of the individual.

Apart from these, having good relationship with the bank manager is an add-on. Every branch manager has discretionary rights to alter loan requirements. Strive to maintain a good financial track record, to enjoy home loan benefits.

Yes, siblings are allowed to take joint loan from any bank for home loan. And with the help of this both can avail tax benefits under Income Tax Act section 80C. However, here are some of the points to be kept in mind while taking a joint loan with a sibling.

1. Joint home loan means both will be the owner of the property thus both has rights on the property however if the sibling is just a borrowers then he/she has the right of liability. A sibling can be a co-owner of the property only if you share the liability of the property as co-borrowers, else banks will not consider you as a co-owner. Loan liability and co-ownership percentage can be altered as per each applicant’s requirements.
2. In case if siblings are taking a home loan, usually banks will approve the loan amount upto 10 years of tenure. This is the maximum tenure that is offered if siblings are the applicants.
3. Under section 24 (interest repayment) and 80C (principal repayment) both the applicants have the right to claim tax benefits on their home loan.
4. If you have an option to apply for a joint loan, this option is the best if you are in need of huge amount. As the income and CIBIL scoring of both together will be considered by the bank, thus huge amount will be approved. This way you can be the owner of huge property.
5. Pre-EMI option is available even if it is a joint loan. This means both the applicants/ borrowers just have to pay the interest on the loan amount as a pre-EMI until the possession of the property. This works in cases when the property is still under construction, the applicant have the benefit of avoiding the actual benefit until the construction is completed and possession of the property is taken.
6. Do a complete research on the joint home loan for siblings as not every bank will allow this. In cases of disputes bank will have to suffer any delayed payments or failure to pay.

The number of people, who are availing the advantages of the home loan, is increasing day by day rapidly. Many home loan borrowers are now preferring to go for a joint home loan options due to various benefits such as the benefit to avail higher loan amount, income tax benefits and many more to name a few. A co borrower is the person that shares the ownership of the home loan in an asset with you or group or individual. The factors such as credit rating and CIBIL scores are being taken in to the consideration as far as home loan joint application is concerned.

However, there are certain eligibility rules and conditions that have to be satisfied that can be mentioned as follows.

• The joint home loan can be availed maximum by six people and minimum by two people.
• The co-borrower may or may not be the co-owner of the said property; however banks or lenders shall prefer that a co-borrower should be the co-owner of the property.
• The joint home loan repayment is the collective responsibility of the main borrower as well as co-borrower(s). Each of them is equally liable as far as repayment is concerned.
• If the home loan borrowers are married, then the same seems to be a perfect arrangement to the home loan lenders or providers. The couple is having the liberty to decide that which one of them wants to be the co-borrower and which one of them wants to be the co-owner.
• If the applicants of the home loan are the son and father duo, or unmarried daughter and father or mother and unmarried daughter or mother and son, then bank or lenders shall prefer that son or daughter should be the primary owner of the property.
• In the case of two brothers applying for the same, the lender or bank insist that they should be the co-owner of the property.
• Unmarried couple living together or friends claiming for the joint home loan are usually not allowed for the same.

Home loan co-borrower and co-applicant is one and the same thing if we take a larger picture in the consideration because the person is sharing equal responsibility as far as the repayment is concerned. Hence, in special cases, the lender may consider to transfer the loan completely to a co-borrower. However, there can be some disadvantage in being a co-borrower in certain cases that can be discussed as follows.

1. Conflict between Wife and Husband: - If husband and wife, any one of them is a co-borrower and both of them are paying the EMIs for the home loan, and because of the conflict, any one of them stops paying the EMI then the other borrower faces the problem.
2. In case of death of Prime borrower or co-borrower:- In case if the prime borrower or co-borrower meets death, then the rest of the amount that has to be paid by the borrower, who is alive. It becomes the person’s responsibility to repay the amount and that can create a burden for the person.
3. WILL beneficiary can be different: - if husband and wife are the borrowers of a home loan and the husband decides to inherit property to the parents or siblings and not to wife or let’s say he decides to equally distribute the property between parents and wife, the if a wife is not co-owner but just a co-applicant then it can create a huge trouble for her.
4. Default Case: - in the case of default, the home loan applicant assets can be at risk be it co-borrower of borrower.

To avoid such cases, It is very essential that the home loan applicants are having separate legal liability agreement that has all the terms and conditions mentioned. The agreement should have stated and classified the liability of each and every party that is involved. The parties involved should execute the same on the legal stamp paper and should notarize it. Banks promote the co-borrowing as the same reduces the risk in terms of repayment of the loan. The bank can also insist in terms of getting the insurance as far as protection of repayment is concerned. It is essential for the borrower and co-borrower that they safeguard the loved ones by properly following terms & conditions as the future is quite uncertain and one should be ready to encounter any situation.