With the drastic increase in the rates of properties. It’s impossible for the middle-class people to buy the home from their saving. Definitely, they require a home loan for getting the enough fund to fulfill their dream of owning a home. Home loan is a long term, so it needs a deep analysis from both ends either lender or borrower. Lender to be confirmed with the eligibility of repayment of lender and borrower also have enough resource or capability to repay the loan and also ensure they are going with the suitable loan based on their eligibility criteria.
The process of applying a home loan is so easy but for getting the loan approval it needs so money processing steps that borrower needs to satisfy. The Borrower undergoes much verification’s in order to get approval for the loan. Your lender must get the complete satisfaction on your repayment capacity. As lenders don’t want to increase their non-performing assets. The capability of the applicant is analyzed in different forms to get the clear idea.
What are the things that bank consider as the priority in approving or rejection of loan?
Consideration of Age:
Generally, the lender considers the borrower with their age lies in between 20’s and 30’s. As home loan is a long term process. If they consider aged people then they will get the retirement in a few years then their repayment capability will decrease. So they prefer the people with young age. So that they can repay within their working years.
In case if you have crossed 30’s then you can go with high EMI, that will also help you to get the low-interest rates on loans.
Calculate your Eligibility:
When you apply for a loan bank take care of your every expense. So that they can calculate the capability of the applicant to repay. If the borrower has already applied for loan payment on EMI basis then this amount will get deducted from the income and based on the remaining they calculate the eligibility. Also, they check for the FOIR doesn’t exceed 50% of their monthly income.
You can add your family members or spouse in order to apply for a high loan amount.
Maintain a good Credit Score:
People with 700 or above is considered as a good credit history. Credit score maintains your complete financial details from banks and financial institutions. In case, if your loan get rejected don’t go for applying it continuously try to improve your credit score by paying the credit and other fees on time. And bank or lenders consider you as credit hungry and offer you have a high-interest rate for the loan.
Various others reasons for Loan rejection are:
Irregular payment of delinquencies or utility bills:
Company checks for the payment of your electricity, water bills, etc and also they check for the repayment of credit card amount and EMI payments and if they find the irregularity or nonpayment of such bills then it will effect on your credit history and the reason for rejection of your home loan.
The lender takes into account the job stability of the borrower. If they keep on changing the job in a year and two years they won’t consider them.
Before applying for a loan, you must check with the property documents, legal proofs, resale ability, and legal forms. Because lender check for this, because if we don’t repay they can auction the property to recover their loan amount.
Check for Complete Documents:
Check for the I’d proof, address proof, pay slips and other sources of income documents on the place.
These are some of the things the lender consider for approving of the loan. So keep this thing in mind before applying for the loan and try to improve your credit score for quick approval of your loan.