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The deciding factors for Home Loan Eligibility

Posted by : Pooja Agrawal on | Jun 26,2019

Buying a home is a once in a lifetime investment and so it is very much important to do thorough research about the real estate market. Deciding on a property that has all the basic amenities is also essential. After everything is sorted out then comes the most important part which is financial planning.

The above-given sequence could be altered based on individual observation and needs. But for now, let’s assume we have shortlisted a couple of properties and found our dream home. So the next step is to do effective financial planning that not only satisfies the needs of home buying but also be enough to fulfil your daily basic needs. Like every other person in this world, you would opt for a home loan. So let’s check what factors should you keep in mind when opting for a home loan?

The first and foremost factor is the applicant’s eligibility. You would choose to visit your bank and apply for a home loan. However, the first step is to know about your eligibility as to whether you are qualified for your loan application to be approved. There is one more thing to remember as a buyer and that is which lender should you choose for your home loan. There are two types of lenders- 1. Housing Finance Companies (Non-banking) 2. Banks. For now, we will choose the bank as our lender.

Banks want to ensure that you repay the loans on time which provides a sort of guarantee that you are capable of repaying. There are multiple criteria based on which a bank decide on before passing a request of a home loan application. Some of them are: 

Credit Score: The very first thing to remember before applying for a home loan is to know your credit score. Banks love customers with a good credit score. For a score with a range between 300-850, a credit score of 700 or above is generally considered good. A score of 800 or above on the same range is considered to be excellent. Timely repayment of loans increases your credit score. So remember to check your credit score before applying for a home loan.

Age Criteria: Your age is a major factor that can decide on the amount of loan you are eligible for. People aged between 24-65 are eligible for getting a home loan however the loan amount decreases as the age increases.

Employment Stability: For you to be qualified for a home loan, stable employment is very crucial. You must be employed for a minimum of 2 years under the same employer. For a salaried person, the maximum repayment tenure is 60 years.

Since everything is not so easy, pre-planning is a must and before you opt for the home loan make sure that you have enough savings for the down payment as well. This seems to be the main hurdle before the home buyers and their dream homes. Here many buyers turn their back on their homes and choose to go for cheaper options or live in rented homes. In order to provide opportunities to everyone buy their home, HomeCapital with their Down Payment Assistance Program helps the buyers fulfil their dream.


HomeCapital allows the buyers to buy a home at a very early stage of their lives by contributing up to half of the down payment requirements. This credit free assistance is repayable in equal monthly amounts without any form of fees or interest. They believe that buying your first home early has a compounding wealth effect, happier lives and increased social security for your family.