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Every major event in your life, like good education, marriage, business, medical emergency, or vacation, needs finance. Loan against property or Mortgage loan is an easy and effective way to meet such financial needs.
Mortgage loan
it is also known as a loan against property. It is a secured loan where you pledge an asset or a property to the lender for the money you borrow. Many banks and NBFC offer loans against property, and each has its set of eligibility criteria, which you must fulfill to avail of this loan. Here is a list of factors that influences your eligibility for a mortgage loan:
- Your income at the time of loan application:
Your loan eligibility and the total loan amount have a lot to do with your annual income. The lenders consider your income as a measure of your ability to repay the loan amount on time. Some lenders offer incentives and benefits like EMI holiday, top-up loan facility, lower interest, repayment flexibility, and many other value additions when applying for a mortgage loan in India.
- The status of your employment
Your employment status is as important as your income in deciding your eligibility for a mortgage loan. You stand a better chance of getting loan approval if you are a salaried individual. Employment with a reputed company can be a surety of a regular monthly income and timely payment of EMI. Your chances of getting a loan against property are bright even if you are self-employed and have a stable and flourishing business. Good employment status can get you a flexible repayment facility and a lower interest rate.
- Your Credit Score
A credit score indicates your debt repayment history, current loans, other dues, and defaults. Any score above 700 can be an excellent score to get LAP approval. The credit score helps the lender to judge your financial creditworthiness and ability to repay the loan amount.
- Your Age
Age is an essential factor for mortgage loan eligibility. You must be in the age group of 21 to 60 years for loan eligibility. Age is so important that the lenders consider it to calculate your loan repayment efficiency. They calculate the years left for your retirement home loan application made in the early phase of your life. This also allows you to bargain a good deal from the lender.
- Your existing debts and other commitments
Your loan against property eligibility also depends upon your debt to income ratio. Having other loans on your name or dues like credit card payment is not the problem. The issue is missing your EMIs, late repayment, irregular credit bill payments, and a low credit score. These irregularities in reimbursement lower down your credit score, which in turn negatively affects your LAP eligibility.
Your eligibility for a loan against property depends upon all these and many other factors, which you must study properly for quick approval for the loan. Do your homework thoroughly and analyze your eligibility accordingly. You can improve your chances of loan approval by working on your credit score and source of income.
