Home loans should ideally be availed when an individual is having a consistent and stable source of income. The individual borrower who plans to avail of loans should have confidence about stable income from the job or self-employed business. The borrower should also have a good credit score to get the loan approved. And should also have a sufficient amount of savings in the bank account to pay the future installments. The borrower can avail 80% of the property value as loans from the bank; however, the actual eligibility of the loan approval depends upon an individual’s salary. The rest, 20% of the property value, needs to be paid as a down payment to the real estate developer. Having consistent income and a stable income source is very much necessary as the loan installments start with the immediate effect, and delay in payment of the installments can lead to a penalty being charged by the lender. The interest rates being charged by the lender and the total repayment value should be verified on the loan agreement by the applicant before proceeding ahead with the loan application.
The EMI calculator is a tool available on every website of the bank or finance company. The loan eligibility can be checked by entering the details of the monthly salary, age and accordingly, the loan eligibility can be calculated. Also, if an individual chooses the loan amount, then, in that case, the monthly installment being chargeable can be seen on the EMI calculator tool. For the married couples, if both persons are earning, then in that case, the borrower can avail of home loans jointly, considering the income of both the people. Having more than one person earning in the family is always better as there is stable financially. If the income of one individual stops, the other person has a proper source of income to pay the home loan installments. If the financial condition is stable, then it proves that the applicant is home loan ready. The bank may approve the loans only if the applicant has a stable source of income, all the documents of the properties and identity proof & income proof are in place, and the credit score of an individual is good.
Ways to analyze whether the individual is home loan ready or not
- Keep a clean credit score:
The individual should maintain a good credit score before applying for home loans. An individual’s credit score can be checked on the official website of the CIBIL, and if it is found below, the borrower should try to improve it by repayment of current credits on time.
- Maintain a consistent and stable source of income & employment:
The borrower should have a stable source of income consistently. Also, there should not be any frequent job changes in case of the availing of loans. Bank does not approve a loan if there are frequent changes found in an individual’s job. Thus the stability of the job is also necessary.
- Clear all debts, if any:
While extending loans to the borrower, the bank expects that there should not be any existing debt pending on the borrower. The borrower should be debt-free while availing of loans as it can make it easy for the borrower to repay the new loans.
- An online search on the internet:
The individual should do thorough research on the interest rates being charged and also the processing fees. Thorough research should also be done related to the customer experience of the existing borrowers by checking the reviews of the borrowers on the internet.
- Be ready with all the legal procedures:
The borrower should keep all the necessary documents handy. The copies of the ITR returns should be available along with the identity proof, income proof & employment proof, or else in case of self-employed business registration proof.
Becoming future-ready to avail loans is necessary if the property documents are proper, income proof is proper, and the credit score is good, then, in that case, there is no hurdle in getting the loans approved. Thus becoming future-ready before availing of loans by making a proper survey can help an individual get the loans readily accepted.