Compare & Choose from the Best Home Loan Offers
Check Eligibility Criteria of Top Home Loan Providers in India
| Lenders | Loan Amount | Max. Tenure | Age Limit | Loan to Value (LTV) |
| Aditya Birla Housing Finance Ltd. | Based on credit profile | 30 years | 21-70 yrs. | Up to 90% of property value |
| Axis Bank | Rs. 3 L to Rs. 5 Cr. | 30 years | 21-65 yrs. | Up to 90% of property value |
| Bajaj Finserv | Up to Rs. 3.5 Cr. | 20 years | 23-70 yrs. | Up to 80% of property value |
| Bank of Baroda | Up to Rs. 10 Cr. | 30 years | 21-70 yrs. | Up to 90% of property value |
| Bank of India | Up to Rs. 5 Cr. | 30 years | 18-70 yrs. | Up to 85% of property value |
| Canara Bank | Based on credit profile | 30 years | 18-70 yrs. | Up to 90% of property value |
| Central Bank of India | Based on credit profile | 30 years | 18-75 yrs. | Up to 90% of property value |
| DHFL | Based on credit profile | 25 years | 21-70 yrs. | Up to 90% of property value |
| Federal Bank | Up to Rs. 15 Cr. | 30 years | 18-65 yrs. | Up to 85% of property value |
| HDFC Bank | Up to Rs. 10 Cr. | 30 years | 21-65 yrs. | Up to 90% of property value |
| ICICI Bank | Based on credit profile | 30 years | 21-65 yrs. | Up to 90% of property value |
| IDBI Bank | Based on credit profile | 30 years | 22-70 yrs. | Up to 90% of property value |
| IDFC First Bank | Up to Rs. 2 Cr. | 30 years | 21-73 yrs. | Up to 90% of property value |
| India Shelter Finance Corp. Ltd. | Rs. 8 L to Rs. 50 L | 20 years | 21-65 yrs. | Up to 90% of property value |
| Indiabulls Housing Finance | Based on credit profile | 30 years | 21-65 yrs. | Up to 90% of property value |
| Indian Overseas Bank | Based on credit profile | 30 years | 18-70 yrs. | Up to 90% of property value |
| Karnataka Bank | Up to Rs. 5 Cr. | 30 years | 18-70 yrs. | Up to 90% of property value |
| Kotak Mahindra Bank | Rs. 5 Cr. | 20 years | 18-65 yrs. | Up to 90% of property value |
| LIC Housing Finance | Based on credit profile | 30 years | 18-60 yrs. | Up to 90% of property value |
| PNB Housing Finance | Based on credit profile | 30 years | 18-70 yrs. | Up to 90% of property value |
| Punjab National Bank | Based on credit profile | 30 years | 18-70 yrs. | Up to 85% of property value |
| Standard Chartered Bank | Rs. 10 L to Rs. 35 Cr. | 25 years | 18-70 yrs. | Up to 80% of property value |
| State Bank of India | Based on credit profile | 30 years | 18-70 yrs. | Up to 90% of property value |
| Tata Capital Housing Finance | Rs. 3 L to Rs. 5 Cr. | 30 years | 24-65 yrs. | Up to 80% of property value |
| UCO Bank | Based on credit profile | 30 years | 21-75 yrs. | Up to 90% of property value |
| Union Bank of India | Based on credit profile | 30 years | 18-75 yrs. | Up to 90% of property value |
| YES Bank | Rs. 10 L to Rs. 5 Cr. | 35 years | 23-60 yrs. | Up to 90% of property value |
Note: The figures given in the table are indicative and are subject to periodic change at the banks /NBFCs’ discretion..
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| Table of Contents |
General Home Loan Eligibility Criteria for Salaried Applicants
Salaried applicants, who either have permanent service in a government organization or reputed company, are eligible to apply for a housing loan. While the exact eligibility criteria for a home loan may vary across lenders, the following are some of the common eligibility criteria applicable to home loans for salaried individuals:
| Eligible Age Group | 18 to 60 years |
| Minimum Net Monthly Income | Rs. 25,000 |
| Minimum Total Work Experience | 2 years |
| Minimum Work Exp. with current organisation | 1 year |
| Credit Score | Preferably 750 or above |
General Home Loan Eligibility Criteria for Self-Employed Applicants?
Self-employed professionals (such as doctors, engineers, architects, chartered accountants), businessmen and other self-employed individuals who fill income tax returns are also eligible to apply for a housing loan. The following are the indicative home loan eligibility criteria for self-employed applicants:
| Eligible Age Group | 25 to 75 years |
| Minimum Annual Turnover | Rs. 15 lakh |
| Minimum Business Experience | 3 years in current business |
| Credit Score | Preferably 750 or above |
Check: Home Loan Tax Benefit
What Factors Lenders Consider When Calculating Home Loan Eligibility
Your home loan application is subject to an approval and verification process. To get a home loan, you must meet your lender’s home loan eligibility criteria. These criteria are set to ensure home loan repayment. Thus, there are several factors that a lender considers when determining a prospective borrower’s eligibility for a housing loan. Some of them are:
- Credit Score/Credit Report: When assessing your home loan application, lenders check your credit score and credit report as it shows how you have handled credit in the past. Those who paid their EMIs and credit card bills on time and have not overused the credit limit given to them will have a good credit score, which is between 750 and 900. It increases your chance of getting home loan approval. It also improves the chances of getting a housing loan at lower rates and better terms. A credit score below 750 or close to 300 is considered poor. This score might lead to loan rejection or make you pay higher interest rates.
Applicant’s Age: Home loan repayment period usually stretches up to 30 years; therefore, many lenders cap the age of retirement as the maximum age limit. A younger loan applicant can opt for longer loan tenure because he/she has longer working years than the ones nearing their retirement age. The minimum age to apply for a home loan is generally 18 years and the maximum age at the time of loan maturity is usually 70 years.- Income & Employment: High income indicates stronger capacity to repay a loan, which means lower risk for the lender. Usually, salaried employees have a better chance of availing a home loan at a lower rate of interest, as it may be difficult for lenders to accurately assess the income of the self-employed. Lenders also want to ensure that your source of income is regular so that you can pay your loan EMIs on time. For many lenders, salaried individuals should have at least 2 years of total working experience to be eligible for a home loan. In case of self-employed individuals, the business should run for at least 3 years. Moreover, if you are employed with a reputed organizations like an MNC or a Government organization, lenders may offer you a home loan at a lower rate of interest as they perceive this as a sign of stable employment.
- Repayment Capacity: Lenders must be assured that the borrower has the ability to repay the loan. For this they have specific formulas such as debt-to-income ratio and net monthly income ratio that they use to determine whether a borrower has enough money to pay off his loan installments besides taking care of his/her living expenses. Applicants who do not have enough repayment capacity are considered high risk borrowers and thus, may face loan rejection.
- Property: When assessing home loan eligibility, lenders visit the property and examine its physical condition, building specifications and market value to decide on the loan amount they could offer for the property. As per RBI’s guidelines, the maximum amount a lender can offer on a housing loan cannot exceed 90% of the property’s value. This implies that you will have to pay a certain amount as a down payment to buy a home. Contributing more towards down payment helps reduce the loan amount and the loan-to-value ratio, thereby, increasing overall home loan eligibility.
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Documents Required by Lenders to Check Home Loan Eligibility
Lenders require documents to ensure that all information provided by you in the home loan application is legit. Lenders also require documents in support of your income, assets and liabilities (if any) to assess your loan repayment ability before approving your home loan. The list of documents required to avail a housing loan may vary as per lenders, type of home loan, resident type and type of employment. The common set of documents required from salaried applicants and self- employed individuals to apply for a home loan are:
For salaried applicants:
- Proof of Residence: Aadhaar Card / Voter’s ID Card / Rent Agreement / Utility Bills / Passport (any one)
- Proof of Identity: PAN Card / Aadhaar Card / Passport / Driving License / Voters ID (any one)
- Proof of Age: Birth Certificate / 10th Marksheet / PAN Card / Aadhaar Card / Passport / Driving License (any one)
- Form 16
- Certified letter from Employer
- Pay slip of last 2 months
- Increment or Promotion letter
- IT returns of past 3 years
- 2 passport size photographs
- Property Documents: NOC from society/builder, estimate of house construction, occupancy certificate, etc.
For self-employed applicants:
- Proof of Residence: Aadhaar Card / Voter’s ID Card / Rent Agreement / Utility Bills / Passport (any one)
- Proof of Identity: PAN Card / Aadhaar Card / Passport / Driving License / Voters ID (any one)
- Proof of Age: Birth Certificate / 10th Marksheet / PAN Card / Aadhaar Card / Passport / Driving License (any one)
- Income Tax Returns (ITR) of last 3 years
- Balance Sheet and Profit & Loss Account Statement of the Company/Firm (duly attested by a C.A.)
- Business License Details (or any other equivalent document)
- The license of Professional Practice (For Doctors, Consultants, etc.)
- Registration Certificate of Establishment (For Shops, Factories & Other Establishments)
- Proof of Business Address
- Property Documents: NOC from society/builder, estimate of house construction, occupancy certificate, etc.
Also Read: The complete list of home loan documents
What is a Home Loan Eligibility Calculator?
Home loan eligibility calculator is an online tool that helps you determine your eligibility for a home loan. The house loan calculator is easy for anyone to use and gives accurate results on the basis of a few home loan details, which are as follows:
- Monthly Income
- Loan Tenure
- Interest Rate
- Existing loan EMIs
When using a housing loan eligibility calculator, remember that the results are indicative and lenders may require you to meet additional eligibility criteria to actually qualify for a housing loan.
Read Also: How to Calculate Home Loan EMI
How to Enhance Home Loan Eligibility
Some of the ways to improve your home loan eligibility are:
- Improve or maintain a high credit score: Credit score is the reflection of how well you handled your debt in the past. Maintaining credit utilisation ratio below 40% and paying credit card bills and loan EMIs in time show responsible credit behaviour. Such behaviour, when practised regularly, leads to a good credit score, which further improves the chance of loan approval and of getting better loan rates. A poor credit score, on the other hand, might make you pay higher home loan interest rates or lead to loan rejection. Therefore, the higher the score, the better it is (preferably 750 and above). Adopting regular and disciplined usage of credit cards can help to build a strong credit score.
- Prepay existing dues as much as you can: Lenders sanction home loans to those who, as per their evaluation, are most likely to repay it on time. To ensure this, they evaluate your loan repayment capacity through a parameter known as FOIR or debt-to-income ratio. The FOIR tells how much percentage of your income you use each month to repay your existing loan EMIs and credit card bills. If your FOIR is 50%, lenders will consider this a negative factor that may impact your loan eligibility and the rate of interest. So, if you have the last few EMIs left to pay in an ongoing personal loan or any other consumer durable loan, repay it before applying for a home loan.
- Take a Joint Home Loan: Due to inadequate income, low credit score or high debt-to-income ratio, your lender might reject your home loan application. If not eligible for a home loan, add a co-applicant to the home loan application and go for a joint home loan. But that co-applicant must be an earning family member with a good credit history and satisfactory repayment capacity. Doing so will increase home loan eligibility and help in getting a higher loan amount. If the co-applicant or primary loan applicant is a woman, then you might get a home loan at concessional interest rates.
- Check if your lender is offering a step-up loan: Under this scheme, lenders offer loans at lower EMIs in the initial years, which gradually increases as you start repaying the loan. It is typically meant for younger borrowers. The lender increases the EMI as the borrower progresses in their career and earns a higher income. The interest outgo in a step-up loan is higher than in a loan with a fixed EMI. Use step-up EMI only if you are sure of better earnings potential in the future.
- Approach a lender that has tie-up with a mortgage guarantor: The eligibility criteria for home loans offered in a tie-up with a mortgage guarantee company is more relaxed. A mortgage guarantee firm such as India Mortgage Guarantee Corporation (IMGC) ties up with lenders to help promote and advance home ownership. As mortgage guarantors can take more risk than a bank, the loan products that lenders offer in a tie-up with them have relaxed eligibility criteria. A borrower can get 20-30% higher loan amount in such a loan.
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Home Loan Eligibility FAQs
Q. How lenders determine home loan eligibility?
A. Lenders determine your home loan eligibility primarily on the basis of your income and repayment capacity. Other parameters that lenders consider when assessing your housing loan eligibility includes your age, qualification, assets and liabilities, number of dependants, credit history, stability and continuation of your occupation and savings history.
Q. How much home loan can I get based on my salary?
A. Your disposable income or in-hand salary plays an important role in determining how much amount you can borrow from a lender. It will determine the EMI you can afford and thus the amount you can borrow. But your eligible home loan amount based on your salary may vary from one lender to another. Also, your salary is not a sole factor that lenders consider when assessing your home loan application. For instance, if your in-hand salary is Rs. 20,000, you can avail as much as Rs. 14.91 lakh as a loan, provided you have no existing financial obligations. But if your take home is Rs. 40,000, you can avail a loan amount of Rs. 30 lakh for the same property. Subsequently, if your income is Rs. 50,000, your home loan eligibility will increase and will get you a home loan amount of about Rs. 37.28 lakh.
Q. What is the maximum home loan amount that I can get?
A. Most lenders have no limit on how much they can finance as a home loan. The maximum home loan amount that many banks offer is of Rs. 10 crore, subject to various terms and conditions. Moreover, the maximum housing loan amount that you get varies from one lender to another. Other factors that these financial institutions take into consideration when determining your home loan amount includes your income, age, credit score, repayment history, existing liabilities, property features, occupation and the lender’s LTV ratio.
Q. What is Net Monthly Income (NMI) Ratio?
A. Some lenders calculate eligible home loan amount using a multiplier applied on your net monthly income (NMI) after reducing taxes and other payroll deductions. In such cases, the eligible housing loan amount can go up to 30 times the NMI of the applicant. If the loan applied for exceeds this amount, the application may be rejected. So, higher the NMI, higher is the loan eligibility.
Q. What is Loan-to-Value (LTV) Ratio?
A. LTV is the ratio of a loan amount against the value of an asset. In simpler words, it tells you the maximum loan you can get against the value of your property. For example, if you are buying a home costing Rs. 1 crore, and your lender’s LTV ratio is 75%, then the maximum financing or loan you will get from your lender is Rs. 75 lakh.
Lenders use this ratio to evaluate risk in lending a housing loan to a borrower. This ratio also helps in ensuring that a lender doesn’t lend an amount higher than the actual value of the property.
As per RBI guidelines, the LTV ratio for home loans can range from 75% to 90% of the property value. This implies that up to 90% of the property value will be financed through home loans and the remaining 10% will have to be shelled out of your pocket as down payment.
Q. What is the minimum salary required to be eligible for a HDFC home loan?
A. Currently the minimum salary to be eligible for a HDFC housing personal loan is Rs. 25,000. However, meeting the minimum salary criteria doesn’t guarantee that your housing loan application will be approved.
Q. How much home loan can I get on a Rs. 40,000 salary?
A. Lenders will decide your eligible home loan amount on the basis of FOIR (Fixed obligation ratio) or LTV (Loan to value ratio) of property. The lower of these two ratios will be your housing loan amount. Let’s say, your FOIR is 50% and LTV is 90% for a property, which amounts to Rs. 66 lakh. Now, considering you have no other financial liabilities, the maximum amount you can pay every month is Rs. 40,000*50% = Rs. 20,000.
If you choose the tenure to be 30 years, then as per FOIR, your eligible housing loan amount will be = Rs. 20,000*12*30 = Rs. 72 lakh. But, the LTV ratio of 90% of the property value, which will be Rs. 66 lakh*85% = Rs. 56.10 lakh. So, the loan you can get on Rs. 20,000 salary is of Rs. 56.10 lakh.
Q. How much home loan can I get on a Rs. 20,000 salary?
A. The eligible home loan amount is determined on the basis of either FOIR (Fixed obligation ratio) or LTV (Loan to value) of property. The lower of these two parameters will determine the housing loan amount. So, for instance your FOIR is 50% and LTV is 85% for the property, which is of Rs. 30 lakh. Now, let’s say there are no ongoing outstanding debt that you have to repay, then the maximum amount you can pay each month is Rs. 20,000*50% = Rs. 10,000.
If the tenure for home loan is 30 years, then as per FOIR, your loan amount = Rs. 10,000*12*30 = Rs. 36 lakh. However, the LTV ratio of 85% of the property value, which will be Rs. 30 lakh*85% = Rs. 25.50 lakh. So, the loan you can get on Rs. 20,000 salary is of Rs. 25.50 lakh.
