Welcome Guest! Contact us +91-9471830444 Follow on:    Contact Us |  FAQs |  Free Register |  Login 

Repayment Capacity

By ResidenceBuy India  |  0 comments   |  1807 views  |   Feb 02 2012


Some key factors lenders check to determine your repayment capacity:


  • Income: Lenders consider your current and future projected income as an important factor in determining your creditworthiness. If you jointly apply with your spouse or parents then the income is pooled together for credit consideration. This is the reason why joint application increases the chance of obtaining a home loan. Often the EMI is set around 35% of pre-tax income (for joint application it is 30% of the combined pre-tax income).


  • Past payment history: Regular monthly payment on other loans (e.g. car loan and credit card loan) in the past is essential for establishing a good credit history (which is a must for getting a home loan).


  • Debt burden: High debt burden adversely affects your chance of being approved for a home loan.


  • Value of the property: Lenders only finance part of the loan amount (usually less than 80%).If the house is too expensive then it is possible that lender may decide not to finance the loan (or only finance a small portion of it). On a different note, if you are approved for a loan amount higher than the property value, we suggest you use your judgment to decide whether it is wise to go for a more expensive property (see affordability section above to learn more).

Leave a Comment

Buying Guide
Shortlist properties

Shortlist properties: Now that you are ready to go, here are some key facts to keep in mind:

Read More
Buying Guide
Home buyers tips on mortgage

As a homebuyer you are bombarded with a Niagara of information. Here we distill it for you so that it makes sense.

Read More
NRI Guide
Property Documentation

Property documentation: Here is the required property documentation for NRI to get home loan

Read More
Selling Guide
Tips for builders for new real estate projects

Key prerequisites: Make sure that you have all the legal documents ready and all the govt. regulations fulfilled before the project starts. Otherwise the project can be mired in long legal

Read More
Selling Guide
Enhance the home Value

Enhance the home value:Given that you have decided to sell, and have a good pricing strategy based on extensive research and market trend, it is time to make your property attractive.

Read More
Email Alert

  Articles & Blogs
  Guide & Tips