The building or buying a home is one of the most cherished dreams of everyone. People save and invest in multiple tools to grow money to make way for funds for a home.
However, due to inflation and other factors, such investments are not enough to buy a home. It is where availing a home loan comes as a respite. You can take up to Rs.10 crore of the loan at a lower interest rate.
You also get to enjoy a longer tenor for loan repayment. Lenders also let potential borrowers apply and manage a home loan account via an online home loan app on their mobile phones. You can apply for a loan, pay EMIs, make a prepayment, foreclose the loan and do more on a loan app. At present, there are several lenders that offer finance apps.
However, since a home loan is a long-term funding solution, lenders look at multiple aspects before approving the loan application. Are you also looking to apply for a successful loan application and approval? Then you should go through some elements that a lender looks at while processing your home loan application. Read on!
Things that Lenders Consider Before Home Loan Approval:
- Your CIBIL Score- Your CIBIL score is the first parameter that a lender looks as it ascertains your creditworthiness. Having a good Credit score denotes that you have managed your existing loan debts and repaid credit card bills on time. A strong CIBIL Score is anything above 750 out of 900. Anyone with an excellent score can get the loan approval fast and at a lower rate of interest. If you don’t have a decent score, you can improve it by paying your loan and other debts on time.
- Existing debts- Your overall loan eligibility comes down if you are already serving many other debts and paying multiple EMIs. Lenders consider some home loan applicants with no pre-existing debts and it means that you are capable enough to serve the housing loan.
- Age- Age is another crucial factor for home loan approval. Applicants in the age group of 30-50 years are likelier to get their loan approved. It is because they have more working years left to repay the loan EMIs without defaults.
- Employment stability- If you are a job hopper, who does that just for the sake of getting 10-20% hike, can’t be considered an able home loan candidate. It is because you don’t have the employment stability to repay the loan. As a result, you should at least have an income record of 3 years to get the loan approval.
- Down payment- How much down payment you can give may also determine your loan eligibility and approval. You should know that lenders don’t sanction the entire cost of a property that you wish to buy as the home loan. The standard ratio is between 70-85%. The remaining amount needs to be paid by the homebuyer. Hence, if you are able to pay about 20.0% as the loan down payment, then you may get the home loan approved. Also, the higher your down payment, the lesser loan principal you will need to manage and as a result, you may pay reduced EMIs.
Some of the key factors that your bank or lender will consider while processing the home loan application for the approval is enlisted. You can assess your condition before applying for the loan and improve your chances for a hassle-free sanctioning.
If you are ready, then you can apply for a home loan via home loan app of your lender 24/7 and without issues. Online loans via apps save you from the hassle of visiting a branch office. Bajaj Finserv comes with pre-approved deals on home loans, personal loans, business loans and more. It may help you minimize loan formalities by making it fast.