Applying for a home loan? Here’s how to maximise your chances of qualifying for it

Owning a home is a prized dream for everyone. With the profusion of options in realty (across abodes of various styles, sizes and budgets), rising disposable incomes, the recent thrust in affordable homes and the current moderation or correction in prices, owning a home has truly come within the reach of nearly everyone. And home loans happen to be the most popular route to reaching that cherished goal since banks are willing to disburse with them loans with a reasonable appraisal of status and paperwork and on friendly instalment (EMI) terms.

If you are planning to purchase a property on loan, it will help to brush up on some factors or steps that can make getting a loan easier.

Make sure you don’t have too many breaks in your employment history

Being consistently employed helps in raising the chances of getting a loan significantly. Being attached with the same employer for at least 2 years is interpreted by loan givers and financial institutions as a mark of stability and dependability, and a potential indication that the person will exhibit a similar consistency when it comes to paying the monthly instalment.

A healthy bank balance

Having sufficient savings in the bank always helps to make a favourable impression and a strong case when it comes to applying for a loan. Not just because it provides a broad picture to the lender about your financial maturity and comfort levels. But also, because a certain minimum amount will be required to pay up the initial down-payment. Incidentally, the higher your Down-Payment amount, the easier it is to get sanctioned for a loan for the remainder of the property cost. 

Credit history

If you have taken other loans in the past, you next lender may want to check out your record of repayment. All loans and credit history – measured as a ‘Credit Score’ – can be checked via one’s CIBIL record. You can access it online yourself, too. A healthy past in terms of honouring commitments creates a positive profile and vastly enhances the probability of a loan. 

Utilize the Co-applicant feature

Most loan providers give you the option of adding a co-applicant to your loan application. Now, if your spouse has a healthy monthly income, adding him or her as a co-applicant (and thereby clubbing both income sources to boost the overall financial health) can greatly heighten your probability of securing the home loan.

Go for a pre-approved loan

Start the process on a surer foot by getting your loan eligibility checked by any leading bank or financial / loan institution of the country. If the project you are planning to buy has partnerships with some banks, it’ll be a good idea to get your Pre-approved Loan status from one of them. A pre-approved loan status doesn’t force you to take a loan – it just lets you know, well in advance, whether you can get a loan or not when you need it. This adds peace of mind and removes confusion during the process of making a final selection. 

Type of property

The kind of property you choose to buy can also significantly influence your loan eligibility. The builder’s reputation, the cost of the property and the legal and compliance status of the project (whether it is riddled with disputes or ‘in the clear’) are all important considerations for your lender.