Home Loan Eligibility For The Salaried: How Much Home Loan Can I Get On My Salary
If you are wondering ‘how much home loan can I get on my salary’, you must evaluate the home loan eligibility criteria. Home loans for salaried employees depend on many factors. Salary is one of the important parameters.
This article gives you all the details on home loan eligibility, documents required, interest rates, how is home loan eligibility calculated, how to apply for a home loan online and things to keep in mind. Read on!
Home Loan Eligibility Criteria as Per Salary Bracket
Before approving a home loan application, lenders usually consider various factors such as salary, credit score, age, etc. Most lenders offer on average a loan amount that is 60 times a borrower’s salary.
However, an important point to keep in mind for borrowers wondering ‘how much home loan can I get on Rs. 40,000 salary’ is that lenders do not consider an applicant’s in-hand salary when determining the loan amount. They exclude medical and travel expenses when accessing one’s income.
For example, on Rs.20,000 salary, you can get a home loan of close to Rs.10 lakhs against a repayment tenure of 20 years.
Similarly, if you receive a higher paycheck each month and wonder ‘how much home loan can I get on Rs.50,000 salary, the answer would be an amount close to Rs.30 lakhs. You can use an online home loan eligibility calculator to check your loan eligibility.
For a clear understanding, you can refer to the table below:
| Monthly Income (in Rupees) | Home Loan Amount (in Rupees) |
| 25000 | 1,373,026 |
| 30000 | 1,709,806 |
| 40000 | 2,383,366 |
| 70000 | 5,220,146 |
Home Loan Interest Rates
Various banks and NBFCs provide home loans to eligible borrowers at a certain interest rate. Check the interest rates offered by top lenders before applying for a home loan:
| Lending Institutions | Interest Rates Starting From (per annum) | Processing Fees |
| Navi Home Loans | 7.39% onwards | 1% |
| Kotak Mahindra Bank | 7.50 % onwards | 0.5% |
| Axis Bank | 7.60% onwards | 1% |
| Yes Bank | 8.95% onwards | 1.5% |
| ICICI Bank | 7.60% onwards | 0.5% – 2% |
| HDFC Bank | 7.55% onwards | 0.50% |
| Bank of Baroda | 7.45% onwards | 0.50% |
| Bank of India | 7.40% onwards | 0.25% |
| LIC Housing Finance | 7.50% onwards | Check with lender |
| Federal Bank | 8.55% onwards | 0.50% |
| Union Bank of India | 7.40% onwards | 0.50% |
| Reliance Home Finance | 9.75% onwards | 0.5% – 1% |
Calculate Your Home Loan EMI
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Home Loans for Salaried Employees Eligibility Requirements
Home loan eligibility criteria involve satisfying certain parameters. Here’s a list of eligibility requirements for getting a home loan approval for salaried employees.
- Stable source of income
- Should have a minimum of 3 years of work experience
- Must be an Indian citizen
- The applicant should be over 18 years old
Also read: Documents Required For Home Loans
How is Home Loan Eligibility Calculated?
The easiest way to determine eligibility for housing finance is through an eligibility calculator.
Potential borrowers need to visit the website of their preferred lender, navigate to the eligibility calculator, and enter the following details:
- Net monthly salary
- Tenure for loan repayment
- Sources of monthly income
- Any existing loans and EMIs
With an online loan eligibility calculator, you can enter the above-mentioned information and check how much loan amount you can borrow.
Features and Benefits of Home Loan
1. Tax benefits
Borrowers can claim IT deductions on interest and principal repayments under Section 80C, 24(b), 80EE, and 80EEA of the Income Tax Act, 1961.
2. Stringent checks on property documents
Since the lending institution conducts thorough checks on property documents, borrowers can stay assured of the veracity of the property. However, it’s still advised that you do a thorough check from your side as well. This eliminates the chances of scams.
3. Lower interest rate
Since home loans are secured loans, the interest rates are comparatively lower than unsecured loans, such as personal loans. For instance, interest rates for Navi Home Loans start at 7.39% p.a. Moreover, borrowers can also avail of a top-up loan on the existing home loan to curb cash crunches.
4. Long tenure for repayment
Home loans come with a longer repayment period that can go up to 30 years. Flexibility in repayment tenure lowers the financial burden on borrowers.
5. Option for a balance transfer
Borrowers can transfer the loan from one lender to another to enjoy lower interest rates, better terms of service, and such. Opting for a home loan balance transfer from Navi lets you enjoy reduced interest rates of up to 5%. Download the Navi app and check for yourself.
Factors Affecting Home Loan Eligibility
Some of the key factors affecting your eligibility are mentioned below:
- Credit score: Applicants who have a CIBIL or credit score of 750+ are considered creditworthy by lenders. Such applicants can avail of housing finance on favourable terms.
- FOIR: FOIR refers to fixed obligations to income ratio. Lenders are more likely to offer favourable terms to applicants with a low FOIR. This is because a low FOIR indicates high disposable income, which increases the borrower’s chances to repay the loan amount in due time.
- Applicant’s age: The applicant’s age dictates the tenure of the loan. Younger people have a longer service period, thus loan tenure will be longer for them. A longer tenure ensures smaller EMIs, hence making the loan more affordable. The age of the applicant is considered an important aspect while using the home loan eligibility calculator. However, for long-term loans, you usually pay more as interest.
Also read: Types Of Home Loan Options Available In India
- Step 1: Applicants need to download the Navi app and register using their mobile number to proceed.
- Step 2: Enter the property details such as the location of the property, its type, and address.
- Step 3: Provide PAN, age, name, marital status, and whether there is a co-applicant or not. After completing the steps mentioned above, individuals will get instant approval for the loan amount they are eligible to avail of.
Apart from the benefit of instant approval, Navi also provides a high-value loan amount at low-interest rates starting from 8.93% p.a.
How Can Individuals Increase Their Home Loan Eligibility with Low Salary?
1. Opt for a joint home loan
If one applies for a home loan with an earning co-applicant, then the eligibility to avail of a higher loan amount improves significantly. Also, some lenders offer special rates for women borrowers.
2. Clear any existing loans
If you have an existing loan, try to clear it before opting for housing finance. This is because lenders assess an individual’s repayment capacity by calculating their debt-to-income ratio.
3. Improve CIBIL score
Lending institutions prefer individuals who possess a CIBIL score of 750 or above. So, to increase home loan eligibility, you should strive toward improving your CIBIL score.
4. Mention additional income sources
Additional income sources assure the lender about an individual’s repayment capacity. Hence, borrowers should always mention other sources of income to the lender, if any.
Things to Consider before Getting a Home Loan
- Consider your salary amount.
- Consider the EMIs you need to pay every month.
- Consider the interest rates offered by lenders depending on your CIBIL score, age, salary, etc.
- Consider the down payment amount.
- Consider the trustworthiness of the lender.
Final Word
Availing of a home loan for salaried employees is a lot easier. Moreover, with the application and loan disbursal process going digital, applying for and getting a home loan for salaried employees has also become convenient. You can gauge how much home loan you will be eligible to borrow against your monthly income and calculate home loan repayment EMIs depending on the interest rate and tenure. If you are considering getting a home loan, download the Navi app and get a home loan today!
FAQs
Ans: Moratorium denotes a specific period where borrowers do not have to repay any loan amount. In simple terms, this is the waiting period before the borrower starts paying the EMIs.
Ans: Home loan prepayment is a facility wherein borrowers fully or partially repay the loan amount before completion of the loan tenure. However, home loan prepayment is subject to various rules that a borrower must know beforehand.
Ans: Lenders calculate EMIs by considering the loan amount, tenure, and interest rate of the home loan. The EMI may change if the interest rate changes or if you make part-payment against your loan.
Ans: A home loan balance transfer is a facility provided to borrowers to transfer the current home loan balance to a new lender. This provides the borrowers with better deals and an affordable loan option.
Ans: The loan amount for 35000 salary will be decided by the lender depending on the interest rates, age, CIBIL score, etc. You can get between Rs. 1 lakh – 2 lakh loan on 35000 salary.
Before you go…
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Disclaimer: This article has been prepared on the basis of internal data, publicly available information and other sources believed to be reliable. The information contained in this article is for general purposes only and not a complete disclosure of every material fact. It should not be construed as investment advice to any party. The article does not warrant the completeness or accuracy of the information, and disclaims all liabilities, losses and damages arising out of the use of this information. Readers shall be fully liable/responsible for any decision taken on the basis of this article.
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