Home Loan Eligibility Based on Income Levels and Age

There are some criteria that every borrower must meet to get a home loan. These criteria are known as home loan eligibility criteria.   If a person qualifies all the  loan eligibility criteria, it indicates that they will be able to pay back the loan.  

If someone doesn’t meet the criteria for a home loan, it may adversely affect his or her credit profile, and the application for a home loan may be rejected. Before applying for the loan, you must check home loan eligibility.

Eligibility criteria for a home loan

There are many criteria to qualify for home loan eligibility. These are:

  • Stable Income
  • Age between 22 and 65
  • Good CIBIL score and history
  • Nature of employment and experience
  • Low Existing debt

If individual applications qualify every criterion, they can get a higher home loan amount. The eligibility criteria for lenders are user-friendly so that more applicants can get their home loan approved.

The following are certain eligibility criteria for a home loan.

  • The age range for salaried employees must be between 22 to 65 years (or retirement age)
  • The age range for a self-employed person must be between 25to 70 years
  • A CIBIL score above 700 with an excellent credit history and no defaults.
  • The minimum work experience required for a salaried employee is 1 year
  • A self-employed individual must have at least three years of experience
  • In metro cities like Mumbai, a home loan requires a salary of INR 25,00

Eligibility for a home loan based on income

One of the most important criteria to qualify for a home loan is the total income of the applicant. The salary is considered important by the lender because it helps them know whether the lender will be able to repay the loan amount.

Your net monthly and annual income will help the lender decide what amount to lend you for a home loan. The  loan eligibility amount varies as per age and net monthly income. For instance, a person who is 25 years old with a monthly income between INR 25,000 to 50,000 can get a loan amount ranging between INR 18 to 38 lakhs, providing that they meet all the other eligibility criteria and have sufficient repayment capacity. However, if the same individual earns more than INR 50,000, he can get a loan of up to INR 50 lakhs. However, these are rough estimates and vary as per other factors.

Eligibility for a home loan based on age

Another important criterion to qualify to be eligible for getting a decent home loan is your age. The minimum age for getting a home loan is 21 years.

You will be eligible for an extended repayment tenure if your age is lower. If your age is low and your income is high, then you will be able to get a higher loan amount. Remember to check your home loan eligibility on the lender’s website before applying for a home loan.

Some lenders like Grihshakti require the following age criteria-

  • If you are a salaried employee, then your age must be between 21 to 65 years to be eligible for a home loan.
  • If you are a self-employed person or have a business of your own, then the age range changes. One must consult their preferred lender for information about the same.

Remember that these criteria vary from lender to lender.

An applicant’s age also decides the loan tenure. For instance, a 25-year-old borrower can get tenure up to 30 years opposed to a 50-year-old borrower who will most likely get a tenure up to 15 years, assuming the lender considers them eligible in other respects. These factors again vary as per the applicant’s income and employment status.

How to know whether you are eligible for a home loan or not?

To know whether you are eligible for a home loan or not, log in to the website of the lender. As mentioned earlier, the eligibility criteria differ from lender to lender, but overall they are similar.

The eligibility criteria give an overview of your credit profile to the lender and help them understand whether you will be able to repay the loan.

Another easy and quick way to check your eligibility for a home loan is to use a housing loan eligibility calculator. Use these calculators to check home loan eligibility before applying for a home loan.

How is eligibility for a home loan calculated?

The house loan eligibility calculator works on a mathematical formula to check whether you are eligible for a home loan. You will be required to enter a few details like net monthly income, property value, and monthly obligations. The calculator will give an account of your home loan eligibility amount within a short time. Lenders like Grihshakti offer home loans up to 90% of the property value, with interest rates starting at 6.5% p.a. and repayment tenure up to 30 years.

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