Most people buy houses in India with the help of home loans. Now, would you rather be spending most of your 50s paying off the monthly instalments of a home loan, or clear off the loan much sooner? If the latter seems like a preferable option, buying a property at a young age is something that you should be doing. Now, at a young age, it is natural to be worried about qualifying for a home loan.
If this is something that bothers you, here are a few tips that can help in improving your home loan eligibility:
- Improve your credit record
A good credit score can definitely help in improving your home loan eligibility. To have a decent credit record, it is important to clear all your bills and existing EMIs on time. There should be no delays in the payments or any defaults. Lenders prefer borrowers who have a credit score of 750 or more.
- Pay off all existing debt
You might have a good monthly income, but it does not amount to much if most of that income is getting spent in clearing out your monthly debt obligations. Lenders also focus on the monthly instalments of your existing loans to understand whether you have room to take on a home loan. It is advisable to clear off any existing debt before you apply for home loan.
- Declare additional sources of income
It is not necessary for an individual to just have one source of income because he is a salaried individual. You can also be running a side business or taking up freelance projects and have additional sources of income. This can help in improving your home loan eligibility, so make sure to declare them to the lender.
- Try and put down a higher down payment
The loan amount that the lender offers can also be influenced by the down payment. Making a higher down payment reduces the lender’s risk since that amount goes towards covering the property price. This can help in improving your housing loan eligibility.
- Maintain a steady employment record
It is quite understandable that young investors looking to buy houses might not have a long employment record as compared to someone who is in their 40’s. However, it is important to have job stability. Having a record that shows too many job changes indicates instability, which can be a risk for the lender. Having a steady employment record can help in improving your home loan eligibility.
Owning a house that can be called yours is a feeling that few pleasures can match. If you are applying for a home loan, starting early is definitely a smart decision, as you can become debt-free sooner! Now, before you apply for home loan, it is advisable to make use of a home loan eligibility calculator, as this will give you an idea of the loan amount that lenders can offer.
