5 Tips That Can Help if Need a Higher Housing Loan Amount


housing loan EMI calculatoR

The housing loan market in India is gaining momentum owing to stable property prices and affordable interest rates, making it feasible for individuals to afford a home. Owing to the affordability, the home loan segment has witnessed a volume growth of Rs15 lakh to Rs.35 lakh over last the 4 to 5 years. 

However, before receiving a sanction for a high-value loan amount, lenders will assess borrowers’ credibility to repay the loan amount. Hence, borrowers should be well-versed with specific tips to help them get a fast-track lending process and receive a higher loan amount. 

5 tips that can help if need a higher housing loan amount

Borrowers can avail of high quantum home loan amount by adhering to the following ways:

  • Clear existing debts

Lenders always scrutinise applicants’ outstanding dues before deciding on a home loan principal. A borrower entitled to multiple dues is considered a high-risk borrower. If borrowers are already swamped under previous loan obligations, they must try to clear them off to better their chance of getting approval for a higher home loan amount.

Closing existing loans will help borrowers save up their disposable income, thereby increasing the likelihood of repaying the loan amount on time. Also, paying debts on time enhances credit score, which widens the scope of getting higher sanctions.

  • Maintain a decent CIBIL score

Home loan lenders consider credit reports to determine borrowers’ repayment potential. A credit score of 750 and above is deemed to be ideal and will help applicants get substantial loan amounts at a lower interest rate. Hence, borrowers must check their credit reports before applying for a housing loan. If they have a substandard CIBIL score, they should improve that by paying off existing debts and keeping the credit utilisation ratio around 20% to 30%.

  • Add a co-applicant

Considering a co-applicant who has a stable income and good credit score is another way borrowers can derive a hefty amount from lenders at reasonable terms. In joint home loan repayment, the responsibility falls equally on both individuals, ensuring lenders of the repayment spree. Looping in a female co-applicant will prove even more beneficial as female co-signers enjoy a lower interest rate. Furthermore, if both the applicants co-borrow the loan amount and decide to split the repayment responsibility, they can share added housing loan tax benefits.

  • Mention additional income source

Disclosing additional earning sources such as rental income, bonus, mutual fund dividends, or extra remuneration from freelancing work ensures a higher amount sanctioning by the respective lending institutions. These ancillary sources of income back up borrower’s repayment of the loan amount. An extra source of remuneration acts as a buffer for borrowers; helping them repay the loan amount effectively.

  • Opt for a longer repayment tenor

Opting for an extended housing loan tenor proves effective in obtaining a higher loan amount. It reduces the EMI burden and suggests that the borrower can make timely payments for the monthly instalments. Furthermore, lenders will have less risk at their end while approving the loan amount as borrowers get additional time to repay the loan principal. However, a borrower should also be well aware of the higher interest outgo over the entire repayment tenor. 

To make a smart decision in choosing the optimum loan tenor, borrowers should use the housing loan EMI calculator. By putting three variables like principal amount (P), interest rate (R) and loan tenor (N) large sanction of home loan interest rate.

Furthermore, borrowers need to adhere to the set of eligibility criteria and keep the required documents in order to derive a considerable loan principal.

Eligibility criteria for availing of a home loan 

The approval for a home loan amount depends on the following eligibility criteria:

For salaried individuals

  • Applicants should be from India.
  • Salaried individuals must fall in the age group of 23 to 62 years.
  • Individuals should have a minimum work experience of three years in a reputed MNC or a private/ public firm.

For self-employed individuals

  • Borrowers should be a resident of India.
  • Self-employed individuals must fall in the age bracket of 25 to 70 years.
  • Applicants must have 5 years of work experience in their current occupation.

Along with catering to the eligibility parameters, borrowers should keep relevant documents like KYC papers, salary slips, proof of business, property documents, and likes. 

Besides receiving sanctions for a high-value loan amount, borrowers can also enjoy the benefits of exclusive pre-approved offers extended by several leading financiers. These offers are available on multiple financial products like home loans, loans against property, etc. and help in expediting the loan application process. Intending borrowers can check their pre-approved offers by entering their names and contact details.

In conclusion, a housing loan effectively means acquiring ample funds to materialise one’s dream of owning a house without exhausting lifelong savings. However, to obtain a higher loan amount, borrowers need to meet the eligibility criteria set by lenders and follow the tips mentioned above.

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