The maximum
home loan amount
you can get depends on your credit worthiness and borrowing potential determined in terms of the norms and standards of the bank.
Here are some of the points that will determine the amount of your home loan:
1. DownpaymentUsually builders ask buyers to pay 10-20 per cent of the value of the property as downpayment. Rest 80-90 per cent can be financed from the bank. You can choose to pay more from your pocket if you can afford. You must save up for the downpayment before finalaysing a property. In case, there is a deficit, you might have take soft loan from your employer, family and friends. Try to minimise the borrowing amount to reduce the interest outgo.
2. Your eligibility Home loan lenders have a list of eligibility criterion and only if you happen to meet those, you are considered a potential borrower. Banks typically look at your credit history to understand your repayment habits and prefer a credit score of 750 for lending out. Your age, income, occupation, collateral security, margin requirements, etc. are also important factors when it comes to determining the interest on the loan.
3. Your affordability of paying EMIsMany times buyers take up a lot of burden when it comes to paying EMI thinking that it would get easier with time, as their income would increase eventually. Consider the possibilities of not getting a raise soon or other unforeseen circumstances. You should look at a loan to income ratio of 20% to 30%. You can make changes in the tenure to reduce or increase the EMI amount depending on your affordability.
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