In order for a home loan application to get approval from the bank, applicants must complete a set of eligibility standards. Banks believe that the borrower is able to repay the loan and will not default if the qualifying requirements are met. However, if an applicant fails to fulfil the eligibility conditions, the bank will reject their home loan application, which will have a negative influence on the user’s credit profile. Because of the qualifying conditions, various banks have varied interest rates on their home loans. The interest rate on a home loan application is set by the bank depending on the applicant’s eligibility. The applicant’s age, income, and credit score all play a role in evaluating whether or not he is eligible for a home loan. 


Each bank has its own set of qualifying requirements. The general qualifying conditions, however, are the same across all of the country’s banks. The elements that determine your home loan eligibility are listed below. 

  1. The Debt to Income Ratio (Fixed) 

All of your prior debts and how much you owe on them, as well as the house loan you’ve applied for, will be taken into account by the lender. 

  1. Return on Investment (ROI) 

If your monthly costs are nearly half of your income, the ratio tells the bank how much of your income you should set aside for loan repayment. 

  1. The Loan to Cost Ratio 

The loan to cost ratio is a measure of how much money is borrowed compared to how much money is financed by the applicant. In other words, it is a way of figuring out how much equity you have in your home.

Home Loan Eligibility Criteria

Depending on their demands, various banks may have varying qualifying requirements. The essential qualifying conditions, on the other hand, are the same for all banks. You must fulfil the bank’s eligibility conditions in order to acquire a home loan. Below is a table that shows the basic home loan eligibility criteria that applies to mostly all the major banks of the country:

Age Limit (Salaried Individuals) 23 Years to 62 Years
Age Limit (Self-Employed) 25 Years to 70 Years
CIBIL score 750 or above
Work Experience for Salaried Individuals Min. 3 Years of Work Experience
Business Continuity Min. 5 Years of Stable Business Background
Salary A Minimum Salary of INR 25,000
Nationality  Indian Citizen

How to Improve Home Loan Eligibility

Here are a few things you can do to improve your chances of getting a house loan: 

  • Assign a working family member, such as your spouse as a co-applicant for the loan. 
  • Discover if a structured repayment plan is available.
  • Ascertain that you have a consistent source of income, as well as regular savings and investments. 
  • Give information on your regular alternative sources of income, such as rental income from a separate property, revenue from a different firm than your current one, and so on. 
  • Keep track of variable compensation components including bonuses, commissions, and overtime.
  • Examine your CIBIL score and follow the tips on how to increase CIBIL score, if your score is low.
  • Ascertain that all outstanding debts and short-term commitments are settled.

Apart from following the above mentioned tips, you can use a home loan eligibility calculator to know your eligibility beforehand. Using the calculator can prevent rejection on your loan application, which can impact your overall credit score. As a result, you can prevent your CIBIL score from falling.


Read Also: What Are The Benefits And Features Of SBI Credit Card

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