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Home Loan Eligibility Calculator - A Complete Guide

by zoya aryaJanuary 17, 2023
Home Loan Eligibility Calculator

To avail and qualify for a home loan in India, borrowers need to meet specific eligibility criteria, as mentioned by reputed financial institutions in the country. Therefore, it is essential to check the eligibility prior hand, as it will reduce the chances of loan rejection. 

To check this, various reputed financial firms have designed a home loan eligibility calculator on their website for hassle-free analysis on part of the borrower. 

What is a home loan eligibility calculator? 

The home loan eligibility calculator is a digital self-help-free tool that instantly checks whether the borrower qualifies for a specific home loan amount. This tool's primary objective is to eliminate the chances of rejecting a loan application, which can be affected by one's credit history. 

Moreover, the hassle-free steps in assessing one’s eligibility make it one of the most efficient hands-on tools for borrowers. 

How to check eligibility using a home loan eligibility calculator? 

Usually, a house loan eligibility calculator functions on a mathematical formula to evaluate reliable results at a quicker pace. Here is the step-by-step guide on how to effectively use this online.

  1. Visit the official website of a financial company and click on the page that redirects them to “home loan eligibility calculator”. 
  2. On this redirected page, a borrower needs to enter details like date of birth and city name in the respective field.
  3. In this next step, borrowers need to enter some value which includes net monthly salary, loan repayment tenor, EMIs of any existing loans, any other sources of income and other financial obligation if it exists. 
  4. Click on submit option, and this tool will provide the result. 

In addition, a borrower's current age is a pivotal home loan criterion that play a great role in assessing eligibility. 

Factors affecting home loan eligibility of an individual

Here are some of the quintessential factors that affect home loan eligibility of an individual: 

  1. CIBIL score

Borrowers applying for home loan with a CIBIL score of 750 or more than that will be likely to avail of this loan at affordable interest rates and on easy terms. This score is mostly responsible for deciphering the creditworthiness of an individual and his/her capability to repay without any default. 

In addition, credit scores can also be responsible for directly increasing and decreasing the EMIs of a home loan. Hence, before applying for a loan and acquiring a fair idea, borrowers can check how credit score determines home loan EMIs. 

  1. Age of the borrower

The reason why financial lending institutions offer more emphasis on the age of the applicant while applying for a housing loan as it directly affects the loan repayment tenor. It is directly proportional as an extended repayment tenor will have comparatively less EMI amount to pay. 

This will reduce the burden and ensure repayment of the loan amount without fail. For better loan management in future and to plan the monthly budgets well in advance, borrowers can check the EMIs to be payable using a home loan EMI calculator for hassle-free computation. 

  1. Fixed obligation to income ratio 

If an individual's fixed obligation to income ratio (FOIR) is lower, he or she will likely enjoy the benefits of more favourable terms offered by the lenders. Keeping a low FOIR means higher disposable income, which means that borrowers will have the capacity to repay the loan on time. 

Conclusion

The accessibility of a home loan eligibility calculator is one of the optimistic approaches that lending institutions adopt. Moreover, the availability of these calculators offers a vivid understanding of how much to borrow and where to improve to make the borrowing process hassle-free. 

Apart from providing all these self-help tools, various financial firms provide pre-approved loan offers to borrowers on secured loans like home loans and loans against property. An individual can check their pre-approved offers by entering their name and contact information. 

The home loan eligibility calculator offers great help in loan management and financial planning. This reduces waiting time and inconvenience of rejecting housing loan applications. 

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