Getting a home loan for yourself is one method with which you can own a house for those who cannot afford to pay the big amount at one go. Taking a home loan to buy a home will require you to pay a fixed amount per month to the lender. This is termed as EMI and you would get all the details of the payment using the home loan EMI calculator. Once you are aware of this, it would be easy for you to plan your finance.
With the ever increase in the rates of real estate properties, most of us indeed depend on home loans to purchase a home. Pag-IBIG acquired assets are useful to determine while buying a property. You can approach a bank, non-banking finance companies, or housing finance companies to get your home loan. These agencies provide you with the funds you need to purchase a home of your choice and to meet your budget. But before actually approving a home loan, lenders consider many things before they approve it. The lenders analyze and judge from various aspects like repayment capacity, credit scores, other loans if you have, previous credit behavior, and your annual income. All these are considered before the loan is sanctioned. So, for a salaried person, if you are wondering how loan you are eligible, the following would give you an insight for it.
- Net Salary – While you apply for a home loan, the first thing the lender considers is your net salary. They check the salary earned by the borrower. The lender predicts the EMI that you can pay based on your per month take-home amount or your net pay. Here is an example that explains it. Mr. Raju is looking to purchase a 2 BHK flat. His salary per month if Rs. 70,000. After a few deductions, he gets an amount of Rs. 65,000 per month in hand that is his net salary. Now, he approaches a bank to take a home loan. Having a monthly salary of about Rs. 60,000 and above, Mr. Raju is liable for a loan whose property value is about Rs. 4,000,000. Based on the place of his residence, the value minimum amount would differ. For example, if he is in a city like Mumbai or Delhi it would differ, and it would also differ for places if he resides in a smaller city like Hyderabad, Pune, etc. As it is clear from this that the lender would base his loan approval based on the city he resides and wish to purchase the property, his per month income, and the property value.
- Repayment Capacity – When you apply for a home loan, the lender would consider your repayment capacity. Your net salary would answer the question as to how much of a loan can you get. However, it is not the only parameter. Before you consider taking a home loan, you must consider calculating your expense per month that would include your credit card bills, utility bills, and any other loans that you have. On analyzing this, you would understand the amount left with you per month. With the remaining amount, you need to make use of the home loan EMI calculator. This calculator is easily available on all the lender’s websites so that you can calculate the EMI. So, you will have an impression of the amount you need to pay per month.
- Credit Score – The lender would consider your credit score before giving you a home loan. A home loan lasts up to 20 years or sometimes even more than that. As it is for a longer-term, the lender requires to guarantee that you would not default on your payments on EMI. To ensure it, lenders would evaluate your credit scores. These scores would help the lender to analyze your credit payment behavior. A high credit score guarantees that you are an accountable borrower. Also, using this, a lender might even increase your sanction amount that is based on your credit scores. You can check online for your credit scores before you approach a lender.
- Age – When you apply for a home loan, the lender would consider your age. If you apply for a home loan in your mid 40’s or late, lenders would be concerned about your age as you are closer to your retirement. Even though you have a high salary, your loan might extend up to your retirement time.
So, before you apply for a home loan you can do a bit of background check yourself and then be prepared for any kind of questions or verification.