Pune is among the largest cities of India and is also considered to be one of the important IT hubs of the country. Due to their enhanced education and reputed institutes, it is also looked upon as the ‘Oxford of the East’; the city has many reputed colleges of every field spanning from medical, engineering and even law colleges. The city also has a large number of automobile manufacturing companies and is considered to be one of the ideal spot for youths to give a launch to their career. With so much offered, Pune seems to be an ideal place for settlement.
If you are planning to buy a house in Pune, you need to know that the realty rates are high in the city and buying a house can cost from Lakh to Crore. The amount might not be easy for many to manage, but you can buy a house in Pune by opting for a housing loan. Here are things that you need to know before applying for a Home Loan in Pune.
Home Loans involve a huge amount of money due to which the lenders approve Home Loans after much consideration. To determine the borrower’s capacity to repay the loan, the lenders have certain parameters that you need to qualify to get your loans approved. The combination of these parameters is called Home Loan eligibility criteria. The eligibility criteria consist of the following things:
- Credit score: Credit score also known as CIBIL score plays an important in your loan approval. The credit score are points given to the applicant based on his or her previous loan repayments. The ideal credit score for the Home Loan approval is 750 points if you have a credit score lower than that, the lender will reject your loan application. If you have a credit score lower than 750 points, you can apply for a loan through Non-Banking Financial Companies.
- Down payment: The lender only offers 60 to 80 percent of the loan to value amount, the remainder has to be paid by the borrower. If you choose to pay a higher down payment, for example, if you pay 35% of the property value as down payment, the lender might reconsider his decision while approving the loan.
- Employment: To check your repayment capacity the lenders often refer to the employment history of the applicant. The applicant should have an employment history of a stable 3 years of employment with any company. The applicant would have to submit salary slips for the loan approval. If the applicant is self-employed, he or she will have to show the Income Tax Return (ITR) of the past three years with his organisation in profit.
- Income: Your income plays a vital role in loan approval, it is used to determine your Equated Monthly Instalments (EMI). To determine your EMI, the income is subtracted off your monthly expenses, and the remainder is accounted for your monthly repayment amount. This formula is known as the ‘Debt to Income ratio formula’. To apply for a Home Loan in Pune, you need to have a salary of INR 40,000, if the property value is around 30 Lakh.
You can refer to the above-mentioned points to avoid your loan from getting rejected, or you can use the Home Loan eligibility calculator to check your loan eligibility.