Friends, do you dream of owning a home? Then it’s difficult to do without a mortgage loan (home loan)! Banks and companies provide money, but in return, they keep the property as collateral.
But not everyone can get a loan – there are certain rules. Let’s understand in simple terms what is required for a home loan in India, and how you can check if you are eligible or not!
Mortgage Loan Eligibility Criteria In India
Age: At What Age Can You Get a Loan?
The first thing is age. In most banks, the borrower’s age should be between 21-65 years. This means a minimum of 21 when the loan starts, and a maximum of 65-70 years when the loan ends. If you are young, the EMI period can be longer, which is beneficial.
Income: How Much Salary is Required?
Banks look at how much you earn. For salaried individuals, the minimum salary is ₹15,000-25,000 per month (depends on the city). For self-employed or businessmen, they check the average income from ITR (income tax return) – at least ₹2-5 lakh annually. Higher income means you can get a higher loan amount.
Credit Score: This is the Most Important!
The credit score (CIBIL score) should be above 750 – this is considered the best. If it’s below 700, getting a loan is difficult, or a higher interest rate may be applied. Paying old credit card bills on time and having no defaults increases the score. If you are taking a loan for the first time, the score might be low, but you can manage it by adding a co-applicant.
Job Stability: How Many Years Have You Been Working?
If you are salaried, you should have at least 1-2 years in your current job, and a total of 3-5 years of experience. The company should be stable. If you are running a business, it should have been operational for at least 3-5 years, and you need to show a profit.
Property Details: What Kind of House is Required?
The loan is given against the property, so the house must meet the bank’s rules. It should be a flat from an approved builder, or construction on a registered plot. The location should be good, and the papers should be clear (title deed, no objection certificate, etc.). The bank checks the property value – usually, they give a loan of up to 80-90% of the property value.
Debt-to-Income Ratio: How Much EMI Can You Afford?
Banks check what percentage of your monthly income is going towards EMIs. Ideally, it shouldn’t be more than 40-50%. This means if your salary is ₹50,000, it’s better to keep the EMI between ₹20,000-25,000. Existing loans (car loan, personal loan) are also counted.
Co-Applicant: You Can Add a Family Member
If your income is low or your credit score is low, you can add your wife, parents, or siblings as co-applicants. Their income is added, and the loan amount increases. Some banks offer slightly lower interest rates if there is a female co-applicant.
Documents: What Documents Are Required?
Basic documents: Aadhaar, PAN, salary slips (last 3-6 months), bank statements, ITR (last 2-3 years), property papers. If you are salaried, then Form 16, and if you run a business, then GST returns and balance sheet.
Loan Amount and Tenure: How Much Can You Get?
The loan amount depends on your income, property value, and age. Usually, you can get from ₹10 lakh to ₹10 crore. The tenure is 5-30 years – a longer tenure means lower EMI, but higher total interest.
| Age | 21-65 years (during the loan period) |
| Minimum Income | ₹15,000-25,000 per month (salaried), ₹2-5 lakhs per annum (business) |
| Credit Score | 750+ best, difficult below 700 |
| Job Stability | 1-2 years in current job, 3-5 years total experience |
| Loan to Value Ratio | Up to 80-90% of property value |
| Debt-to-Income Ratio | Less than 40-50% |
| Tenure | 5-30 years |
| Documents | Aadhaar, PAN, Salary Slips, ITR, Property Papers |
Pros and Cons
Pros:
- The cheapest way to buy a house – interest rates around 8-10%.
- Tax benefits are available (under Section 80C and 24b).
- Easy to manage EMI over a long tenure.
- Benefit from increasing property value.
- Slight discount for women or joint loans.
Cons:
- Loan is not granted if the credit score is poor.
- Can be rejected if there are deficiencies in property papers.
- If you miss EMIs, the house can be taken by the bank.
- Processing fees and hidden charges are extra.
- If the interest rate increases, the EMI may increase (in floating rate).
Conclusion
Taking a home loan is a big responsibility, but with proper planning, the dream of owning a home can be fulfilled! First, check your credit score (available for free from the CIBIL website), maintain a stable income, and ensure your property papers are clear.
Banks like SBI, HDFC, and ICICI have online eligibility calculators – you can enter your details there to check how much loan you can get. If everything is fine, apply, otherwise wait a bit and improve your score. Tell us in the comments, are you planning to buy a house or not?
