A home/housing loan, also known as a mortgage, is an amount of money borrowed by an individual, usually from banks and companies that lend money. The borrower has to pay back the loan amount with interest in Easy Monthly Instalments or EMI’s over a period of time that can vary between 10-30 years depending on the nature of the loan.
Factors that effect Home Loan criteria
Age: Age is an important factor for loan application approval. The younger you are, the easier it is to get a loan for a longer tenure. Banks and other financial institutes may hesitate if you are or closer to retirement
Profession and Income: Unconventional jobs, which are risky and offer no security, or have an inconsistent income flow, can lead the lenders to question your capability for returning the loan amount in time. Frequent changes in your job will also have a negative impact.A steady source of income improves the chances of getting a loan easily, .
Age of Property: If the property, on which you want to take a loan, is very old, the lenders will also conduct an investigation to evaluate the probability of structural collapse in addition to their usual legal & technical investigations. Other existing properties and assets may also be considered by the lender before sanctioning the loan in such cases.
Credit Score: Before sanctioning the loan, lenders evaluate the credit history of the applicant, so it important to maintain a healthy credit score. Unfortunately, if you have very low credit score or many pre-existing loans, your application may be rejected .
Dependents:The number of dependents/co-applicant, for eg. spouse, children or parents, are also assessed before sanctioning the loan. The more dependents you have, lesser will be the disposable income and it is likely that lesser will be your capacity to repay the loan. This can affect your home loan eligibility.