Ways to Increase Your Eligibility for Taking a Home Loan
As per the Financial Express, the delinquency ratio across reputed financiers of India stood at 3.9% in December 2018 which was comparatively lower than that of car loans or other auto loans, which showed a delinquency level of 4.6% in the same period. Although this can be attributed to better financial responsibility from the part of the borrowers, much more specific home loan eligibility criteria employed by leading HFCs is also one of the leading reasons.
Purchasing a house is regarded as among the most important financial decisions of anyoneâ€™s life. So, borrowers should be aware of the various terms and conditions that affect their home loan approval and what steps they can take to increase their worth for home loan requirements.
How Can You Increase Your Housing Loan Eligibility?
Several benefits come with possessing a decent home loan eligibility. It only not only helps to go through the application process without any hassle but also provides you with an opportunity to negotiate with the lender for competitive rates of interest.
There are several methods with the help of which you can increase the eligibility of your housing credit, which are â€“
Opt for a longer tenor
If you opt for a more extended repayment period on your home loan, you can increase the chances of approval. A longer tenor will reduce your monthly EMI liabilities. So, financial institutions are more likely to grant you the loan as you are more likely to make home loan EMI payments on time.
Your creditworthiness thereby enhances, and so you are a lower risk according to the lender which in turn increased the eligibility of your home loan. With the help of a housing loan EMI calculator, you can opt for a repayment tenor suitable to your financial capability and also increase the chances of approval for the housing credit.
Apply for a joint home loan
Homebuyers can increase the eligibility of their housing credit by adding a co-applicant while availing the loan. If the co-applicant has a decent credit score and a substantial monthly income, your chances of approval of the home loan will accordingly increase.
In several cases, financial institutions also club the annual income of all family members of the applicant while evaluating the eligibility of a homebuyer. So, it is advised to keep the above pointer in mind while you take the help of a salary home loan calculator to determine your home loan eligibility and apply for the loan accordingly.
Maintain a CIBIL score above 750
If you possess a high CIBIL score, it indicates that you express responsible loan repayment behavior. Thus, maintaining a CIBIL score above 750 is another option that will help you to increase your home loan eligibility. If you have a below-par CIBIL score, make sure to clear your existing debts. This is will not only help to improve your CIBIL score but also enhance the eligibility of your home loan.
A high CIBIL score is not a common eligibility criterion for most housing credit providers. However, some financial institutions may set a particular parameter for the CIBIL score for home loan approvals. Moreover, possessing a high CIBIL score also provides you with the opportunity of negotiating with your lender for a more affordable interest rate.
Another viable option to improve your home loan eligibility is to declare your additional sources of income which will let your lender understand that you possess substantial repayment capacity.
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