How to Increase Home Loan Eligibility - Tips and Tricks

Dreaming of your own house is fascinating! Today every individual gathers funds and saves money to buy a house. But have you ever thought about the funds? From where you will manage the funds for your dream house? A home loan is the best way to fulfil this dream but think before! Are you eligible for securing a home loan? Applying for a home loan can be easy but before that you need to undergo the eligibility process and how you can increase the home loan eligibility and the chances of getting instant home loan approval.

In this blog, we will be learning all about home loans; their eligibility, process to get home loans online.

What is a Home Loan?

Funds that an individual borrows from banks or any of the financial institutions to purchase a house after meeting the required eligibility criteria asked by a lender. This borrowed money as a loan amount has to be paid back in monthly installments at a particular interest rate. There are many banks or financial institutions that are providing home loans at different rates. But before availing a home loan, compare these lenders with their interest rate, tenure, loan amount, any additional fees, or other necessary factors. Check the eligibility criteria too before applying for a home loan.

Features and Benefits of Home Loan

The home loan comes with many benefits and features, below mentioned are some:

1. Easy availability

2. Multi-purpose

3. Fast loan processing

4. Longer tenure

5. Low interest rates

6. Tax benefits

Here are a Few Tips to Increase Home Loan Eligibility

There are various ways to increase your personal loan eligibility amount to easily afford your dream house. Lenders or banks consider multiple factors such as age, salary, income & employment, and other factors. Let’s understand those tips one by one.

1. Good Credit Score

Home loan eligibility increases by having a good credit score (750 and above). Having a good credit score ensures that all the loan repayments are done on time. A high credit score helps you to provide a high loan amount at low interest rates and longer tenure. Your timely EMI payments will positively affect your credit score but any delay in the repayment will negatively impact your credit score. The banks and lenders check your credit score when you apply for a home loan just to examine your creditworthiness.

Therefore, if you have a high credit score then research properly and take advantage of your high credit score and choose the lenders providing home loans at low interest rates.

2. Add a co-borrower

If you have a family member or friend with a good credit score and a secure job with adequate income then consider adding them as a co-borrower this will increase your chances of getting eligible for a home loan. Lenders usually consider the total income of the borrowing while deciding personal loan eligibility. In this case, the income of both applicants is added and the home loan eligibility is considered accordingly. When you add a co-borrower it also decreases the DTI ratio which in turn helps the borrower to secure a high amount of home loan. If you have a low credit score but your co-borrower has a high credit score then you are still eligible for a personal loan at a low-interest rate.

3. Increase the Loan Tenure

Increasing the loan tenure means lower EMIs and high loan amounts but at the same time increases the overall interest rate. Most lenders offer a tenure period of one to six years. This is beneficial for lenders because by providing a longer tenure a lender asks for a higher interest rate.

4. Increase Down Payment

Another option to increase home loan availability is to increase the down payments. If you have enough savings with you then it is easy to increase the down payment and reduce the loan amount. This will help you to reduce your EMI amount and also lower your interest rate.

5. Reduce Existing Debt

If you already have any debt or credit card due bills then you must clear them first to increase the chance of getting a home loan. Paying off the existing debt on time will enhance your credit score.

Conclusion

Home loan online is the best way to fulfill your dreams and realize your dream of owning a house. Now you don't need to worry about funding for your house, as home loans help you financially to take care of your dreams. After reading this article now you can easily understand everything about home loans and I'm sure you will consider the following points discussed above to increase your home loan availability. Now you see the dreams of owning your house and My Mudra will help you to make the dreams a reality with home loans.

Also read: Home Loan Interest Rate of Different Banks