Home Loan
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Factors affecting your Eligibility for a Home Loan
For a hassle free loan process, ensure you are up to the mark on each of these parameters
Monthly Income
The higher your income, the higher the loan amount eligibility and greater your chances of acquiring your dream home.
Age
Starting early has its benefits. Applying at age 30-35 years makes you eligible for a higher loan amount, as compared to applying when you are 40-50 years old.
Property Value
Quality adds to credibility. Choosing a good property in an approved society, colony or area is viewed more favourably by banks.
Credit History
Your Credit History can open or close the gate to your dream home. Always maintain a good CIBIL score.
Employment Status
As a Salaried person, you must have a minimum of 3 years work experience, to become eligible for a home loan.
Professional/Business Status
As a self-employed professional or a businessman, you must submit your professional details, business status record and bank statements as proof of your financial stability.
Relationship with Lender
A good understanding with the bank can go a long way in negotiating a good loan amount at lower rates.
Your Employer Category
Working at a well-regarded company not only adds to your reputation, but also your loan eligibility. A Fortune 500 Company on your visiting card really helps!
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Special offers
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Zero processing fee on LIC home loan balance transfer till March 31, 2019
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About Home Loan
A home loan is given by a financial institution or bank for property purchase. You can buy/construct/renovate/extend your house with this money and repay it gradually within the chosen time period. Home loans are secured against the property and in case of failed repayment, the lender can use it for debt settlement. The eligibility for a home loan depends on an applicant's income, credit history, property value and location, income proof, and property documents. On the basis of these factors, maximum loan amount is calculated. So, you can compare different lenders. Look at the additional benefits of a home loan:
- Home loan rates are as low as 8.50% per annum
- Special rates for women borrowers
- Tax exemption on home loans
- Compare before selecting one lender
- Option to transfer the loan to a lower rate
- Multi-purpose home loan facility
Types of Home Loans
The different types of housing loans offered by banks/NBFCs in India are as follows:
- Home Purchase Loan
- Land Purchase Loans/Plot Loan
- Home Construction Loan
- Home Improvement Loan
- Home Conversion Loan
- Home Extension Loan
Top Banks Offering Lowest Home Loan Interest Rates Apr 2019
Here is the list of top banks offering lowest housing loan interest rates in India. You can compare and apply online for the best home loan.
| Banks/NBFCs | Interest Rate (p.a) | Processing Fee |
|---|---|---|
| SBI | 8.60%-9.35% | 0.35 % of loan amount and maximum 10,000 +GST |
| ICICI Bank | 9.05%-9.25% | 0.50% of loan amount + GST |
| Bank of Baroda | 8.65%-9.65% | Upto 0.50% of the loan amount or Max ₹7,500 + GST |
| Axis Bank | 8.85%-9.10% | Up to 1.00% of the Loan amount subject to minimum of ₹10,000 + GST |
| Citibank | 9.00%-9.85% | Up to 0.40% of the loan amount + GST |
| HDFC Ltd | 8.70%-9.65% | Up to 0.50% of the loan amount or ₹3,000 whichever is higher + GST |
| Bajaj Finserv | 8.85%-11.15% | NA |
| LIC HFL | 8.95%-9.15% | Upto ₹1 crore: - 0.25 paise + GST or ₹10000 + GST which ever is less More than ₹1 crore - ₹25000 + GST |
| Piramal Housing Finance | 8.85%-8.95% | Up to 0.25% of the loan amount + GST |
| Kotak Bank | 8.90% onwards | Zero processing fee for online application and Upto 1.25% of Loan amount for offline applications |
| Punjab National Bank | 8.65%-8.75% | Zero processing fee for loans disbursed till 31.03.2019 |
| PNB HFL | 9.00%-13% | ₹10,000 + GST |
| DHFL | 9.10%-10.55% | Salaried: ₹Upto ₹20,000 + GST Self-employed Non-Professional: Up to 1.50% of the loan amount + GST |
| Indiabulls Housing Finance | 8.80%-11.05% | Up to ₹5,000 or 0.50% of the loan amount + GST |
| Bank of India | 8.80%-8.85% | Zero processing fee for loans disbursed till 31.03.2019 |
| IDBI Bank | 8.75%-9.10% | Up to ₹5,000 + GST For inward BT irrespective of the amount & PMAY proposals – Nil |
Please note that there are different types of charges which a borrower has to pay as an upfront fee. These charges are not negotiable and processing/application fee is one of them. So, do check all these details before applying for the loan.
Why choose Wishfin?
Home loans are available at almost all top banks/NBFCs so choosing one might be a little time-taking. Wishfin helps you in selecting one suitable lender based on your requirement. Here are the reasons to choose Wishfin:
- Online Marketplace - Wishfin is an online marketplace for loans with unbiased suggestions.
- 16 Million Satisfied Customers - More than 16 million customers have fulfilled their wishes through Wishfin.
- Instant Quotes from Top Lenders - You get instant quotes from top banks and NBFCs.
- Expert Advice - You get expert advice from experienced Wish Experts.
- Transparent Process - Experts are there to answer any query related to your home loan application.
- End to End Service - You get 100% assistance for the loan application ensuring no delays.
- Free CIBIL Score and Report - Wishfin gives you free CIBIL score and CIBIL report with your home loan application.
How to Apply for a Home Loan Online?
Wish Experts guide you in the process of selecting a home loan with lowest interest rate as per your eligibility. The process is much simpler as compared to visiting different lenders offline.
Steps to follow to apply for a home loan
You have to provide the below-given details in the form given at the top of this page:
- Enter desired loan amount
- Select employment status and mention monthly income
- Full name, city name, date of birth, contact number and email ID
- Accept terms and conditions
- Click on 'Get Quotes'
After the submission of the form, another form appears where you have to mention property details such as property value, applicant's gender, residence address, PAN number, and then click on 'Get Quotes'. After completion of this form, you get the list of banks where you are eligible for a home loan.
Wishfin has partnered with WhatsApp to enable consumers to apply for a home loan on WhatsApp. This is the first ever facility where a consumer can apply for a loan on WhatsApp just like chatting with your friends. You only have to answer a few basic questions related and the chatbot will show list of options. The process is simple and instant which makes it convenient and mass-friendly.
What is the eligibility criteria for Home Loans?
Home loan eligibility is based on income, age, credit score, property value and location, etc. The table reflects general eligibility criteria at all banks/NBFCs.
| Parameters | Salaried | Self-employed |
|---|---|---|
| Age | Should be between 21-60 years | Must be between 21-65 years |
| Income | Minimum income of ₹1,80,000 p.a. | Minimum income of ₹1,80,000 p.a. |
| Current Experience | 2-3 years of current job stability | 3 years of current business stability |
| CIBIL Score | 720 or above | 720 or above |
You can also check your home loan eligibility to know the maximum loan amount you are eligible to plan your purchase accordingly. Other than your income, age and professional stability, your property location and CIBIL score are very important. Lenders demand CIBIL score of 720 or above with property in an authorized location. However, if you have a genuine reason for your credit score is lower than 720, some NBFCs can consider your application for the approval but a higher rate of interest.
How much loan amount can you get based on your salary?
Lenders calculate the maximum loan amount eligibility based on your salary. Only 50% of your net take home salary is considered for calculating the eligibility which means you can get higher loan amount if your salary is high. Another factor considered while calculating the maximum loan amount is your existing loan EMI. If a home loan applicant is already paying an EMI, the EMI is deducted from this 50% of the salary and the remaining amount would decide your maximum loan amount eligibility.
Lenders calculate Fixed Obligations to Income Ratio (FOIR) on the basis of your existing EMIs and net monthly income. The percentage of FOIR should be 75% or less. For instance, if your in-hand salary per month is ₹1,00,000 and you are currently paying a car loan EMI of ₹6000 and personal loan EMI of ₹10,000 and you want to know how much loan amount you can get for a home loan, your FOIR would be:
Your disposable income for new loan is: ₹50,000 - ₹6,000 - ₹10,000 = ₹34,000
FOIR = Sum of existing obligations/Net take home salary*100
= ((₹6000 + ₹10,000)/ ₹1,00,000) * 100
= (₹16,000/ ₹1,00,000)*100
= 16%
So, lenders will approve the loan amount for the monthly installment of ₹34,000 or less even for the longest tenure. Other factors such as your credit score help you fetch better deal from the lender.
What are the documents required for a home loan?
The documents required to apply for a housing loan are a bit different for salaried and self-employed applicants. Below are the documents you have to submit along with loan application form:
Documents required for Salaried
- Filled home loan application form
- Identity Proof- Aadhaar Card/ Passport /PAN Card/ Voter ID Card /Driving License
- Address Proof - Passport/Aadhaar Card /Utility Bill
- Residence Ownership Proof - Property Documents/Maintenance Bill/Electricity Bill
- Income Proof - Latest 3 months Salary Slips and Form 16
- Job Continuity Proof - Current Employment Certificate /Current Job Appointment letter (if more than 2 years)/Experience Certificate (including your previous job certificate or appointment and relieving letter)
- Bank Statements - Latest 1 year statement where your salary is getting credited
- Property Documents - Copy of agreement executed / Sale Deed, Share Certificate, Latest Maintenance Bill, List of documents & sanction letter given by Existing Banker (If applicable)
- Advance Processing Cheque
- Investment Proof - Fixed Deposit/Shares/Fixed Assets, etc.
- Passport size photograph/s
Documents required for Self-Employed (Professionals and Non-Professionals)
- Filled home loan application form
- Identity Proof - Aadhaar Card/ Passport /PAN Card/ Voter ID Card /Driving License
- Address Proof - Passport/Aadhaar Card /Utility Bill
- Residence Ownership Proof - Property Documents/Maintenance Bill/Electricity Bill
- Income Proof - Latest 3 years Income Tax Returns including Computation of Income, Profit and Loss Account, Balance Sheet, Audit Report, etc.,
- Business Existence Proof - 3 years old Saral Copy /Shop Establishment Act /Any Tax Registration Copy /Company Registration license
- Bank Statement - Latest 1 year bank statement both current and savings.
- Property Documents - Copy of agreement executed / Sale deed, Share certificate, Latest maintenance bill, list of documents & sanction letter given by existing banker (If applicable)
- Advance processing cheque
- Investment Proof - Fixed Deposit/Shares/Fixed Assets, etc.
- Passport size photograph/s
Please note that income proof is the most important document to get a home loan approval. If you do not get your salary in a bank account, you can not apply for a home loan. Only a limited NBFCs will consider your application for approval at a higher rate of interest. Recently, Union Cabinet declared 10 per cent reservation for economically weaker upper castes recently and now ministry might bring in another surprise for the middle class people of India. The finance ministry might increase the savings limit under Section 80C of the Income Tax Act, providing tax benefits to pensioners and lowering of interest rates on housing loans.