LIC Home Loan Eligibility Criteria

Eligibility Criteria for LIC Home Loan

For Griha Suvidha Home Loan Scheme

Stated below are the eligibility criteria for the applicants who get part of their salary in cash:

• At least 70% component of the salary is received through banking channel
• The maximum loan tenure is considered till the retirement age of the senior applicant whose income is taken into consideration for loan calculation
• Co-applicants can be maximum 2 cash salaried borrowers
• Listed below are the total gross income requirements for home loan approval:

Particulars	Total Gross Income Required
For 1 borrower	Rs 30,000/month
For 1 cash salaried borrower	Rs 40,000/month

Below mentioned are the home loan eligibility criteria for salaried employees having no pension

• If home loan applicant is aged 45 years and retiring at the age of 58 years, the loan tenure will be 23 years (attainment of 68 years of age), i.e. the maximum loan term can be extended by 10 more years post-retirement
• The maximum age considered at the time of home loan application will be 50 years

Home Loan Eligibility criteria for Pensioners

• LIC HFL Home Loan for Pensioners are for the employees working with State/Central Government, PSUs, PSU insurers, and Nationalized Banks drawing pension under Defined Benefit Pension Scheme (DBPS) who are up to 65 years of age as per the last birthday.
• The spouse should be a joint applicant irrespective of the ownership of the property
• Co-applicants can be children and their income can be added for allowing longer home loan tenure and higher loan amount

Eligibility criteria for LIC Top-up Home Loan

• New applicants transferring their existing home loan from other banks/HFCs
• Existing borrowers with consistent track record of timely repayment of their home loan EMIs.

Tips to Improve Eligibility for LIC Home Loan

Adding a Co-Applicant

As a co-applicant of a home loan is equally responsible for ensuring EMI repayment by their due dates, having a co-applicant reduces the credit risk for the lenders. Thus, prospective home loan borrowers having lower home eligibility due to low credit score, employment profile, etc can increase their home loan eligibility by adding an earning member of their family as co-applicant.

As lenders consider the income of the co-applicant while evaluating the repayment capacity of their loan applicants, prospective borrowers with insufficient monthly income can add also earning member(s) of their family as co-applicant(s) to improve their loan approval chances. Note that lenders usually allow applicants to add close family members as co-applicants.

Adequate Funds for Down Payment

The RBI has capped the LTV ratio for home loans at 75% to 90% of the property value, depending on the loan amount. Additionally, LIC Housing Finance would further consider the credit profile of their loan applicants while setting their LTV ratio. Hence, home loan applicants would have to arrange for the remaining component through down payment. Higher down payments can improve home loan eligibility as it reduce the lender’s credit risk.

Home Loan LTV Ratio:

Loan Slab	LTV Ratio
Loan amount up to Rs 30 lakh	Up to 90% of property value
Loan amount above Rs 30 lakh-Rs 75 lakh	Up to 80% of property value
Loan amount above Rs 75 lakh	Up to 75% of property value

Opt for a Longer Home Loan Tenure

Lenders usually prefer home loan applicants whose total EMI obligations (including proposed home loan EMI) does not exceed 50% to 60% of their total gross or net monthly income. Thus, applicants exceeding this limit can select longer home loan tenures to reduce their EMIs. They should use online home loan EMI calculators to know their optimum tenures and EMIs based on their repayment capacity.

Stated below are the tenure of home loan schemes offered by LIC Housing Finance:

Home Loan Schemes	Tenure
Home loan for Resident Indians	Up to 30 years
Home loan for Pensioners	Up to 30 years, or up to 80 years of age of the applicant
Griha Suvidha Scheme	Up to 30 years
Plot Loan	Up to 15 years
Composite Loan	Up to 30 years
Home Construction Loan	For salaried – Up to 30 years
	For self-employed – Up to 25 years
Home Extension Loan	Up to 30 years
Home Renovation/Improvement Loan	Up to 30 years
Home Loan Balance Transfer	Up to 30 years
Advantage Plus Scheme	Up to 30 years
Home Loan for NRIs	Up to 30 years

Improve/Build your Credit Scores

Credit score is considered one of the most important parameter for setting home loan eligibility criteria. Credit scores of 750 and above are usually considered creditworthy and thus, applicants having such credit scores have higher chances of home loan approval. As many banks and HFCs set their interest rates based on the credit score of the applicants, applicants having higher credit scores are more likely to avail home loan at lower home loan interest rates.

Prospective home loan borrowers can build or improve their credit scores by following healthy credit practices, such as avoiding multiple loan or credit card applications within a short period of time and repaying credit card bills on time.

Additionally, periodically reviewing credit reports can help applicants identify errors (if any) and send them to credit bureaus for rectification. Rectified credit reports should improve credit scores and thereby, increase their home loan eligibility.