One of the biggest financial commitments that one makes in their entire work-life years is taking a home loan to own a home, with the involvement of big-ticket amounts coupled with long repayment tenures of as high as 30 years for most lenders. However, as lenders usually put forth an array of different sets of parameters for evaluating your Indiabulls home loan application, the inability to qualify for any parameter can be a cause of rejection or may get you the loan at a relatively higher Indiabulls home loan interest rate.
To ensure that your home loan application doesn’t reject, it becomes prudent to understand and keep in mind these common grounds on which lenders tend to assess the eligibility of applicants:
No or poor credit score
Credit score has, over the past years, not only become one of the most vital parameters for evaluating one’s creditworthiness, but it also forms the basis for determining Indiabulls home loan interest rate to be levied on the home loan. Enquiring with Indiabullsbefore submitting an application would assist in knowing the significance of credit score and whether your current credit score makes you eligible or not for home loan approval. Having a good credit score or credit history helps in multiple ways, especially because it indicates a disciplined credit repayment behaviour and history, which not only raise the chances of Indiabulls home loan approval but also enables the borrower to avail lower Indiabulls home loan interest rate.
Whereas on the flip side, having a poor credit score indicates undisciplined repayment history towards loan EMIs and credit card bills, which can thus, make your lender hesitant towards lending to you, hence resulting in either rejection of your home loan application or lending you at a relatively higher interest rate.
High EMI to Income ratio
While evaluating your loan eligibility and repayment capacity, another parameter that lenders factor in is your EMI to income ratio, which is the proportion of your income currently being used for repayment of mandatory expenses like loan EMIs. In case your ratio breaches the 40-50% mark, lenders may hesitate in lending to you since a higher EMI to income ratio indicates that a major proportion of your income is going out for mandatory debt repayments, implying a higher likelihood of defaulting in future.
Therefore, to avoid getting your Indiabulls home loan application rejected, make sure your EMI to income ratio does not breach 40%-50% after taking into consideration the proposed loan’s EMI as well. If you are unsure about what your EMI to income ratio is and whether it falls in the lender’s eligibility criterion, feel free to contact the lender or check their websiteto know the eligibility for submitting the home loan application. Also, as having a high EMI to income ratio makes you more prone to defaulting in future, you may be charged a higher Indiabulls home loan interest rate to cover up for the higher risk involved in lending to you.
The age of the borrower does not fit in eligibility criterion.
When checking your Indiabulls home loan eligibility, connecting with the lender would enable you to understand that your current and the age at the end of loan tenure are also amongst the crucial parameters factored in by the lender. Lenders generally prefer completion of loan repayment tenure by the time the borrower retires, given that the regular inflow of income would stop post-retirement, or even if pension comes, it would be a much lower amount.
Given that the younger aged borrowers have a higher number of active work life years left to serve a home loan, their eligibility for a long-tenured loan of as high as 30 years is higher when compared to someone in their 40s or 50s. Those nearing retirement can consider enhancing home loan eligibility by taking steps like looping a co-applicant and/or trying to contribute a higher down payment in order to lower the LTV ratio.
It would rather be better to consider roping in a co-applicant such as your earning children or spouse to boost the chances of loan approval. This can also be helpful in fetching low and attractive Indiabulls home loan interest rates as your eligibility would be boosted, thus generating a favourable impact on your credit profile and overall home loan approval chances.
Unsatisfactory property characteristics
As Indiabulls home loan is secured against the property for which you are availing the loan, due diligence is practised by the lender while critically evaluating your pledged property. Before approving your home loan application and sanctioning your loan based upon the property’s value and LTV ratio, lenders consider parameters like location and age of the property. Remember to enquire with the lender before finalizing and submitting the application. Contacting the lender can assist in knowing whether your property is eligible to be pledged and taken a home loan against. Keep in mind that lenders may reject your loan application if the residual age of the property is on the lower side and/or in case the property fails to fall into the geographical limits defined by the lender.
Weak profile of employer and unstable employment history
Both your job as well as your employer’s profile are likely to impact your home loan application. Generally, government sector employees and those working with reputed corporates are termed safer or less risky and hence preferred due to their higher degree of job certainty, instead of those who have unstable income or are self-employed.
Also, the recent trend of frequent job-hopping by individuals in order to get higher income as well as better career prospects is not often seen favourably by lenders. When you contact Indiabulls home loan, you are likely to understand that this practice of shorter employment stints is seen as a sign of an unstable career, and hence, lenders may consider such people as more prone to the risk of defaulting in future, thereby leading to loan rejection. Hence, one should time their home loan application smartly and plan in advance for the same.
One of the neglected but crucial reasons behind many home loan rejections is the lack of adequate documentation. Since complete and proper documentation is important for a loan application’s speedy processing and approval, it becomes imperative to ensure to be always ready with adequate documentation in order to get the application approved. Not being able to submit the required documentation on time can certainly lead to the application’s rejection despite qualifying for all criteria. Being prepared with the documents eases the process and boosts your chances of loan approval as well.
Not able to fall into the minimum income criterion of lender
Almost all lenders set minimum income criteria for loan applicants when evaluating their home loan applications. Income is often the first filter that lenders put in when an applicant applies for an Indiabulls home loan. Such income criteria can even vary as per the applicant’s location-rural, urban etc., due to the different payscale and living expenses of each city. For a person living in metro areas, the minimum income requirement might be certainly more than that required for someone residing in rural or semi-urban areas. Those who do not meet this income criterion generally tend to face outright rejection of an application, or they might get a lower amount approved and may be charged relatively higher Indiabulls home loan interest rate if they fit in all other eligibility criteria but seem to be a risky credit profile to lend to.