Having one’s own house is everybody’s dream and let us be very honest about this we do not want that dream to get shattered due to any reason. So why a parameter like Home Loan Eligibility should get the opportunity to destroy that beautiful dream of yours. Here are few hacks that will help you boost the loan eligibility and will take you closer to your forever dream.
Raising The Tenure
It is considered one of the most effective ways to boost your eligibility for the home loan. In the case of longer tenure, the principal amount and interest rate have no effect i.e., both of them remain the same, and only the net interest outgo has a little rise. The reason behind the increase in the loan eligibility by increasing the tenure is that the burden of equal monthly installments (EMIs) is reduced and the ability to repay the EMI gets more effective. Let us understand this with an example.
Say for an instance you are planning to avail a loan for a tenure of 10 years then there would be a fixed amount that you will be giving the bank on a monthly basis. But consider this tenure is increased to 20 years, then your monthly amount will reduce also decreasing the monthly burden on your pocket. And thus your loan eligibility also increases.
A Clear Status On The Running Or Previous Loans
If you want a surety for the approval on your loan, then you must keep the status clear of all the running or previous loans. It is always advisable that you must pre-pay your previous loans before applying for a new one. When the banks calculate your eligibility for the loan, they take into account the current home loan EMIs that you have been paying and any backlog in this is definitely a red signal to your eligibility. Thus, make sure you have pre-paid all the previous loans, and you have all the enclosures and no-dues certificates as proof to your clearance.
Your Credit Score Has Much To Say
The very crucial parameter for your loan application is your credit score. The banks start with your credit score only and then move towards the next step. So, a good credit score is a must where a low credit score is an alarm to the disapproval. Therefore, if you do not want to face the rejection to your home loan eligibility then always keep an eye on your credit history and maintain a decent credit score to enjoy all the assets of a home loan.
Your Additional Incomes Are The Cherry On Top
Never forget to mention about your additional incomes in the credit record. Additional income can be your variable pay, bonus, your spouse’s earnings, your rental income through any residential or commercial means, your children’s income, etc. All these additional incomes work as a cherry on top and boost the chances of your home loan eligibility.
Your Age Also Matters
The age of the applicant is another parameter that can help you to boost the eligibility for the loan. Your age decides the tenure of the loan and higher your age; lower is the tenure that increases the monthly burden. So try to give your shot at the right time before it is too late.
Keep these factors in mind before you apply for a home loan.