Tips to get approval on your home loan application
Buying a home has become easier with the availability of home loans. You can complete the process online and get it approved quickly. That is if you qualify for the same. You can check this by using a home loan eligibility calculator online. It is a free tool available on all lender websites.
The lenders consider many parameters to determine your eligibility. Checking them in advance and improving them ensures your loan approval. There is a way to make sure you qualify with proper planning.
Consider the following tips for help:
Know your credit score: Your credit ranking plays a significant role in loan approval. It is essential to check it before you apply for the same. You want to have a score that is above 750 to qualify. Once you find it out, you can easily calculate home loan eligibility. Analysing it beforehand also helps you fix any errors in it.
Fix debt-to-income ratio: It pertains to your debt repayment capacity against your monthly income. Lenders ascertain this by asking about your existing financial obligations and through your credit report. It enables them to understand your repayment capacity and determine if you qualify. Fixing it before you apply helps you have an edge in getting better deals and thereby approval.
Contribute higher down payment: It is always a good idea to apply for house loans with a substantial corpus. This way, you borrow lesser funds that are feasible for you to pay back. Hence, you have a greater chance of getting the loan approved. Lenders usually sanction up to 80-85% of the property evaluation as the loan amount. Check your home loan eligibility for the same and try to increase the margin of your contribution.
Compare before finalising: Not all lenders provide the same home loan interest rates. They have their specific criteria for determining your eligibility for home loan. Hence, you should compare their offers before applying. This way, you find the ones with affordable deals and minimalistic criteria. Such offers should help you satisfy the parameters and get approval.
Consider your employment: Check the stability of your job or business and your income. This is also one of the essential factors affecting home loans eligibility. Hence, evaluate the same and only apply after having a stable income for at least three years. It shows the lenders your financial standing and acts as a window for negotiation. It also helps if you apply at a younger age as there is growth potential.
All these measures are helpful if you know your eligibility beforehand and work on improving it. Make sure to consider these aspects before going forward with the application. Planning meticulously and applying to selective lenders ensures approval.