- Looking to know about Home Loan for Self-employed Individuals?
- Know about the best Home Loan offers from leading names like HDFC Limited, SBI, ICICI Bank
The soaring real estate prices make many put their dream home plans on hold. But not when you have a customized home loan that comes with easy EMIs. There are several banks, Non-Banking Finance Companies (NBFCs) and Housing Finance Companies (HFCs) that provide a home loan to both salaried and self-employed. Lenders charge a certain interest rate on the loan amount given to borrowers. Home Loan for Self-employed individuals is generally at higher interest rates compared to their salaried counterparts.
The reason behind this fact is that lenders trust salaried employees a bit more as they get a fixed monthly income every month while self-employed individuals face ups and downs in their businesses. To minimize this credit risk, a few lenders usually charge a bit higher interest rate on the home loan facility when given to self-employed people. But several lenders provide some amazing home loan offers for Self-employed individuals. In this post, we will cover some of the top home loan offers provided by lenders to self-employed individuals. So, if you are a self-employed individual who is looking to purchase the home and confused between several options, this could be a good read for you. Keep going!
Table of Contents
- 1 Top Home Loan Offers for Self-employed Individuals
Top Home Loan Offers for Self-employed Individuals
Several lenders provide a range of amazing offers on Home Loan for Self-employed individuals. We are providing details such as Interest Amount, Loan Amount, Tenure, eligibility, etc. Please check them below.
HDFC Ltd. Home Loan for Self-employed Individuals
If we were to make a list of top home loan lenders in India, the name of HDFC Ltd. would certainly be in the top two. Being one of the leading Housing Finance Companies (HFCs), HDFC Ltd. provides tailor-made home loans to self-employed individuals. The best thing about the HDFC Ltd Home loan is its affordable interest rates that range from 6.70% - 8.00% per annum. When we talk about the Self-employed Individuals, it includes Self-employed professionals (doctors, lawyers, CAs, MBAs, etc), and non-professionals (retail traders, contractors, etc.)
We are showing some of the important points related to the HDFC Ltd Home Loan for Self-employed individuals below. Please check.
- Self-employed individuals can get a loan amount ranging from 75% to a maximum of 90% of the overall property value. This margin (10% to 25%) tends to change according to the loan amount. Other than this, HDFC will also check a few factors such as borrower’s repayment capacity, age, existing obligations, etc.
- If you are thinking about the Home Loan Tenure, you should know that you can get upto 30 years if you are choosing a floating home loan rate of interest. On choosing the fixed rate of interest, you can only opt for a maximum of 20 years. So, you should choose the repayment tenure according to your convenience.
- You can also add a salaried co-applicant to increase your loan amount and eligibility.
- On taking the HDFC Ltd. Home Loan, self-employed individuals will also get tax benefits while repaying the home loan.
- HDFC Ltd. asks for 3 Years of IT Returns and at least 2 years’ Audited Profit and Loss Account Statement and Balance Sheet of Business to check the income and repayment capacity of the self-employed individual.
- HDFC Ltd. also checks the history and profitability of your business to estimate your entrepreneurial ability and overall financial position.
- To get an overview of the EMI amount, you can also use the HDFC Home Loan EMI Calculator so that you can know whether it will be within your repayment capacity.
ICICI Home Loan for Self-employed Individuals
ICICI Bank is also one of the prominent names when it comes to the top private banks that provide home loans to self-employed customers. ICICI Home Loan provides the required loan amount to all the professionals and non-professionals at an affordable rate of interest so that they can achieve their dream of owning a home. ICICI Home Loan interest rate for self-employed individuals depends on the loan amount and your credit score. We are showing it in the below table. Please check it.
|Loan Amount (In INR)||CIBIL Score >=800||CIBIL Score 751-799||CIBIL Score<=701-749||CIBIL Score<=700||New to Bank|
|Upto 35 Lakh||6.85%||6.95%||7.50%||7.80%||7.85%|
|Above 35 Lakh-75 Lakh||6.85%||7.00%||7.60%||7.90%||7.95%|
|Above 75 lakh||6.90%||7.00%||7.70%||8.00%||8.05%|
Other than the loan amount, ICICI Bank home loan interest rates also depend on a lot of factors such as borrower’s age, monthly income, property location, credit score, existing obligations, etc. So, the lender will check all of them and decide the final rate of interest for you. We are showing some of the other important details about the ICICI Bank home loan for self-employed individuals below. Have a look.
- Self-employed individuals can also opt for the ICICI Bank Home Loan Balance Transfer facility at an affordable interest rate. With this facility, they can reduce their EMI amount and interest outgo over the loan tenure. The Home Loan Balance transfer interest rates range from 7.25% to 7.50% per annum (applicable to any loan amount) for self-employed individuals.
- Any Self-employed individual can apply for an ICICI Bank Home Loan easily by filling a simple application form on the official website of ICICI Bank.
- If you want to know the maximum eligible home loan amount, you can use the ICICI Home Loan Eligibility Calculator. Fill in a few basic details, and it will give you the results within a second. Similarly, you can use the EMI Calculator to have an estimate about the monthly installment.
Documents Required for Home Loan for Self-employed Individuals
There are a few documents that Self-employed individuals need to submit at the time of application. These are Application Form with recent photographs, Last 6 months bank statement, Form 16/ ITR, Proof of Business Existence, Last 3 years ITR with computation of Income.
SBI Home Loan For Self-employed Individuals
State Bank of India (SBI) is undoubtedly the largest public sector bank of India that offers a range of financial products to customers. Among these is a suitable home loan offer for self-employed individuals. Such non-salaried individuals can opt for the home loan amount to fulfill their several financial needs such as construction, purchase, repair and renovation of the existing house or flat. The loan can be taken at pretty affordable interest rates that will make the EMIs within your repayment capacity.
The loan can be taken for a tenure of 30 years. But you should remember that choosing a longer tenure can make you pay a higher interest amount but your EMI will be lower and vice versa on choosing a shorter tenure. So, choose the tenure according to your repayment capacity.
Eligibility for Self-employed Individuals
There are a few important conditions that a non-salaried individual has to fulfill before applying for this SBI Home Loan. Have a look.
- The applicant must be a resident of India.
- The business should have an existence of at least 3 years.
- The business must have earned a profit in the last two years.
- The minimum age of the applicant is fixed at 18 years.
- Self-employed individuals can opt for a loan amount minimum of INR 50,000, and it can go upto a maximum of INR 50 crores. However, the final loan amount will depend on the overall profile and credit score of an applicant.
If you are a self-employed individual and want to apply for an SBI Home Loan, you need to do it very attentively. Missing a single document can cost a rejection of your home loan application. We are showing all of them below. Check them out.
- Loan Application
- Proof of Residence
- Proof of Address
- Property Papers such as Occupancy Certificate, Plan Copy, Payment Receipts, etc.
- Last 6 months bank account statement for all bank accounts held by the applicant
- Loan Account Statement for the last 1 year (if any)
- Income Proof for Non-salaried Applicants
Axis Bank Home Loan for Self-employed Individuals
Axis Bank, which is one of the leading private banks of India, also provides Home Loans to Self-employed individuals at an affordable rate of interest. Any self-employed individual can easily apply for an Axis Bank home loan. The best thing about this loan facility is an applicant can get a loan amount as low as INR 3 lakh. The margin tends to vary from 10% to 25% according to the loan amount. For example, for home loans below INR 30 lakh, the minimum margin is fixed at 10% of the overall property value.
Axis Bank Home Loan Interest rate for Self-employed individuals ranges from 7.95% to 8.55% per annum that lets you pay pocket-friendly EMIs. The final rate of interest will be decided by the Axis Bank and will depend on the overall profile, repayment capacity, property location, etc. You need to keep this fact in mind that home loan interest rates directly affect repayment amount; higher the interest rates, higher would be the EMI amount. Axis Bank does not ask for any prepayment charges from the self-employed individuals.
Axis Bank checks many factors before deciding the eligibility for Self-employed individuals, such as the income of applicant/s, age of the primary applicant, number of dependents on the primary applicant, Assets & Liabilities of the Applicant, Stability and Continuity of applicant’s business. These factors will contribute in determining the loan amount for a self-employed applicant. The minimum age of an applicant must be 21 years and it can go upto as high as 65 years of age.
Proof of Income Documents for Self-employed Individuals
- ITR for 2 years, Computation of Income, Profit and Loss, etc
- Tax Audit Report (if the gross annual turnover is above INR 1 crore or Gross Receipts are above INR 25 lakh)
- 6 Months Bank Statements of Business and personal A/c
- Business Continuity Proof for the last 3 years
Bank of Baroda Home Loan for Self-employed Individuals
After the recent merger of Dena Bank and Vijaya Bank into it, Bank of Baroda has emerged as one of the leading public sector banks of India. Known for its several financial products, one of its popular products is the Home Loan to Self-employed individuals. One of the main reasons is its lower home loan rate of interest that ranges from 6.75% - 8.25% per annum.
However, the final rate of interest will depend on the overall profile of the self-employed applicant, loan amount, and a few other factors. Bank of Baroda charges minimal processing charges on its home loan facility
A lot of individuals have this question about the maximum loan amount that they can get. Bank of Baroda decides the loan amount according to the location and monthly income of the applicant. For example, if you are living in semi-urban and rural areas, you can get a maximum loan amount of INR 1 crore, while this amount can range from INR 5 crore to INR 10 crore if you are living in metro cities. Though you can add one of your closed family members as co-applicant of your home loan to receive a higher loan amount. If you are paying the loan amount before the fixed tenure, you don’t need to make any prepayment charges.
Self-employed Individuals can get upto 90% of the overall property cost as the loan amount from Bank of Baroda Home Loan. The remaining 10% is known as the Margin and you will need to pay this amount in to get a home loan.
Eligibility for Self-employed Individuals
There are a few conditions that you need to keep in mind when applying for a Bank of Baroda Home Loan. It is important to meet these conditions. Check them out.
- The minimum age of the applicant should be 21 years.
- The applicant should be earning a stable income so that he or she can repay the loan amount without any trouble.
- The maximum tenure is fixed at 30 years but it should not exceed the age of 70 at the time of loan completion.