Getting a home loan is one of the most important decisions you will ever make in your life. There are numerous things to consider, and an even bigger number to terms and conditions that you have to comply with. We know it gets troublesome at times, but hey, that’s what we are for. We will take all your troubles and give you solutions in return. Regrob loves to help you out!
So today we will talk about planning to get a home loan according to your current income. This is a crucial aspect to consider, so let us get into the detail of it.
Now, we will discuss about–
- Impact of current income on Loan
- which type of loan take to consider our current income
- Home loan eligibility of different banks
How do you plan to arrange finance for buying a new home? For most of us, the answer would be a combination of both of these.
1) Personal savings.
2) Home loan from a bank or other financial institutions.
So you see, your home loan makes up a huge chunk of your dream home decision. And your home loan eligibility depends greatly upon your current income to be specific. This is because your current income determines your ability to pay EMIs. Generally, your monthly income will define the chances of repaying the loan and timely payments of EMIs. If you are a salaried person, your monthly income will be taken into account and if you are self-employed, in that case your annual profit would decide your home loan maximum eligibility.
The loan amount basically depends upon the net income of an individual. Most of the banks lend a home loan up to 60 times of an individual’s net income. For example, if your take home salary is Rs. 30,000, you are eligible to get a loan of around Rs.18 lakhs.
Available income is a major factor considered for your home loan eligibility. It is considered on the amount left with you after deduction of any EMI amount that you are currently paying for any kind of loan. Your Home Loan Eligibility will be calculated after deductions of the EMIs that you are paying. Hence, available income will decide your position and capability as to the amount of loan you can take and EMIs you can pay. The banks advise you to restrict your EMI to 35% to 45% of your monthly income so that you can pay this debt without burning a hole in your pocket.
The left over amount can be used for other monthly household expenditures and any other emergency requirements. Though it is good to be hopeful about rise in your income, it is not advisable to opt for a bigger EMI on the basis of this alone. We advise you to opt for an EMI amount that will enable you to set aside at least 15-20% as monthly savings. Before borrowing, determine how much EMI you can afford and understand the circumstances that can impact your EMI.
Since your EMI, that too one you are going to pay for your home loan is a significant amount of expense on your monthly budget and it is bound to stay with you for next few years. So, before signing the dotted line, take time to consider all the factors such as your present income and lifestyle, the prospect of increase or decrease in your income, your ability/chances of getting another job in case of loss of present job, your future expenditures, retirement plans and goals. Make your decision only after you consider all of these things.Click here to read about Home loan insurance a very useful products.
Check out the table below to see your eligibility criteria-
|Name Name||Loan Amount||Minimum Salary Requirements||Tenure|
|SBI Home loan||It will be determined taking into consideration such factors as applicant’s income and repaying capacity, age, assets and liabilities, cost of the proposed house/flat etc.||Not Available||Maximum 30 years or up to the age of 70 years of the borrower whichever is early.|
|ICICI Bank Home Loan||It depends on the repayment capability and is restricted to a maximum of 90% of the property value.||12000/- p.m.||Maximum 30 years|
|HDFC Ltd Home Loan||Max amount up to 90% of the value of the property and also depend on the repayment capacity of the individual||Not Available||20 years for loans under fixed rate and 30 years under adjustable rate home loan products|
|Axis Bank Home Loan||Minimum Rs 3lacs||Not Available||Max. tenure is 30 years.|
|Axis Bank-Empower home loan scheme –a home loan for self- employed individuals||Minimum Rs 10 lacs
Maximum Rs 150 lacs in tier 1 & 2 cities and Rs 50 lacs in other cities
|Not Available||15 years and age of the borrower should not exceed 65 years of age at the time of maturity.|
|Bank of Baroda||Maximum loan amount Rs 2 Cr.||The loan eligibility is as follows
Gross monthly income is less than Rs 50,000-48 times of average of the last 3 months gross monthly income
More than Rs 50,000-to Rs 1 lac- 54 times of average of the last 3 months gross monthly income and More than Rs. 1 lac -60 times of average of the last 3 months gross monthly income.
|Max tenure is 30 years|
|Citibank Home loan||80% of the property value||Not Available||Max tenure up to 25 years.|
|HSBC Bank||Min. Rs 3 lacs and max Rs 10 crore||5 lakhs p.a. if you are salaried and 7.5 lakhs p.a. if you are self employed||Max tenure up to 25 years.|
|LIC Housing Finance||Generally the loan is extended upto 85% of the property value.||12000/- p.m.||Max. 30 years. The term for the loan will under no circumstances exceed the age of retirement or completion of 70 yrs of age whichever is earlier|
So now all you have to do is, analyze your current income, talk to your lender and then you can go ahead with the process of applying for a home loan for your dream home. We wish you lots of luck for the same.
FOR MORE INFORMATION CALL US:-9529331331