What lenders look at
Every lender has its own scorecard, but most weigh a similar set of factors when deciding how much to lend you and at what rate. Here's what typically matters.
Age
Most lenders want the loan fully repaid before you reach a certain age (commonly around 60-70), so your age at application affects the maximum tenure you're offered.
Income and employment
Salaried applicants are usually assessed on take-home salary and job stability; self-employed applicants on business income and continuity, typically evidenced through 2-3 years of records.
Credit score
A higher credit score (based on your repayment history on existing loans and cards) generally means easier approval and can help you negotiate a better rate.
Existing debts
Lenders look at your total EMI obligations relative to income (often called FOIR) — the more you already owe elsewhere, the less they may be willing to lend.
Property value and location
The lender values the property independently. Their loan-to-value cap and the property's marketability both affect how much they're willing to finance.
Co-applicants
Adding a co-applicant, such as a spouse or parent with their own income, can increase the loan amount you're eligible for.
Simple ways to improve your eligibility
- Pay down existing credit card balances and small loans before applying.
- Add a co-applicant with a steady income where possible.
- Avoid taking on new loans or credit cards right before applying.
- Keep your income documents and tax filings up to date and consistent.
- Opt for a slightly longer tenure if your eligible amount is coming in short.