Axis Bank Home Loan Eligibility

Computing your home loan eligibility can be quite cumbersome, owing much to the fact that it is rarely explained in a manner that is easy to understand. Here we explain with an example the process of determining an individual's Axis Bank home loan eligibility.

Portion of salary available from making EMI payments:

Let us suppose an individual has a net salary of 30,000 per month. Some home loan companies will consider 55 per cent of the net monthly salary as being available for EMI payments. In this example, the amount works out to Rs 16,500 (i.e. 55 per cent of Rs 30,000). An individual's income determines the percentage of salary available for making EMI payments. The higher the salary, higher the percentage. This is because a higher salary means a higher disposable income, and therefore a higher amount available for EMI payments.

Understand your home loan eligibility:

All housing finance companies, including Axis Bank, have their own EMI table. It lists the monthly EMIs per lakh, for varying interest rates and loan tenures. Here we show you how to calculate home loan eligibility using an example.

Let us assume an interest rate of 8% and a tenure of 20 years. Let us say the table gives us an EMI per lakh of Rs 836 for the assumed interest rate and tenure. An individual's home loan eligibility is determined by this EMI per lakh and the amount available for making EMI payments, calculated above. To be precise, we divide the amount available for making EMI payments, which is Rs 16,500, by the EMI per lakh, which is Rs 836. By doing so, the home loan eligibility comes out to be approximately Rs 19.7 lakhs.





Different home loan providers can have a different method to calculate home loan eligibility, but all methods are essentially governed by the same principles. Some have a different percentage structure, while some calculate the percentage of salary available for EMIs based on an individual's gross salary rather than the net salary. Also, the calculations will differ in case of self employed individuals.

Following are some intangible factors that also play a crucial role in determining an individual's home loan eligibility:

Profession of an individual: Home loan providers usually have an unofficial list of "negative professions". If an individual is in one of those so-called negative professions, getting a home loan might be an uphill task for him.

Property location: Housing finance companies (HFC) also have a list of "negative locations". An individual trying to buy a property in such a location may not be granted a loan. Moreover, define geographical limits. The property must fall within those limits for the HFC to sanction a home loan for it.

Personal profile of the individual: An individual's home loan eligibility is also governed by a few factors that relate to his personal profile. These factors include, but are not limited to, his credit score (credit repayment history), saving habits, and number of people dependent on him financially.

It would be wise on your part to understand the basics of home loan calculations prior to getting a home loan. This will aid you in determining the portion of your income available for making EMI payments. Armed with the right information, you can go ahead and select the best offer from Axis Bank home loan.

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To know more about your Axis Bank home loan eligibility visit the Axis Bank home loan website. Then fill out the quick contact form to avail...