Considering A Home Loan? Keep These Tips In Mind!

Irrespective of whether you are a self-employed or a salaried individual, Indians across geographies and generations have always shared a dream of owning a home. Most Indians associate homeownership with social standing and national identity.

Home loans are a vital part of home buying or building experience. That said, acquiring the financial tool is a process in itself and requires quite a lot of tasks to be carried out smoothly and competently. Factors such as the loan amount and interest rates influence which loan product you choose. Moreover, several factors determine just how eligible you are for the loan. You must pay adequate heed to these factors as they will determine whether or not your loan application will be approved. It also determines the tenure and terms of the loan as well as the time it will take for the loan application to be processed.

Here are some things you must consider when you apply for a home loan!

  1. Type Of Employment

Typically, you can apply for a home loan of an amount of up to 80% of the total value of the home. In case you work on a salary, banks will review your net income in order to assess your loan application. On the flip side, if you are a self-employed individual, it might be more challenging for you to get approved for a home loan. Financial institutions are reluctant to lend money to self-employed persons because of their lack of financial stability. However, you can still apply and follow the process diligently to get a home loan.

  1. Good Credit Score

For both self-employed and salaried professionals, good credit history is of paramount importance. Financial companies regard the credit report as a basis on which to grant or deny a loan. This report speaks of your credit-worthiness, and the approved loan amount, interest rate, and duration will depend on the report. Hence, it is a good idea to pay your credit cards on time and ensure your previous repayment behavior is spotless.

  1. DTI & Net Income

Net monthly income is another important factor considered by banks for home loan applications. It applies to both self-employed and salaried individuals. That said, it is also crucial to ensure a good repayment capacity and a low DTI (Debt-To-Income) ratio. This will reflect your robust financial health and will tell financial institutions that you can take on more debt at the point without any risk.

  1. Age

Age is another vital factor that affects the loan duration, regardless of whether you are self-employed or a salaried individual. Banks tend to prefer young applicants because they do not have as many liabilities and have more possibilities of rising in their professional career with time.


Most of us aspire to move into our own homes, but this journey consists of a number of decisions and steps that must be taken along the way. By keeping the above-mentioned steps in mind, you can take a giant leap towards getting your dream home with an approved home loan application.

If you are face any difficulty in repaying your loans, explore loan settlement. Register and talk to our counsellors for more information.

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