When applying for a property loan, these are the essential criteria that you should take into account.

• Income Proof

Every lender and bank would require you to produce your income proof. Always apply for a loan EMI that is up to 30% of your income and never more than that. It helps increase your chances of getting the loan sanctioned and also make it easier to pay the EMI without fail through the tenure.

• Value of the Property You Own

By default, most banks and lenders would approve loan up to 80% or 90% of the property value. However, it is good to avail only what is required rather than availing the entire sum as you have to repay the principal amount with interest. It also helps reduce interest rate when you accept a loan sum according to your requirement and not your total eligibility. Hence, always check the loan against property eligibility before applying for the loan.

• Your Age

All lending institutions consider your age because when requesting loans with 20-year tenor, the lending institution is more likely to find people aged between 25 and 55 more reliable as they have years of a working career ahead of them.

• Credit History/ CIBIL Score

The credit rating board maintains a history and score for all individuals who pay their taxes. Your PAN card and other information such as ADHAAR card will be used to verify your previous loans, any pending payments before a new loan are issued. The score is out of 900 and 750+ is considered a good score. But, if you have a score of 650+, even then NBFCs are likely to extend you a loan.
 

When the factors work in your favour, applying for a property loan to fund your new home or business is the best way to go.

Reference Read: Know your Eligibility for Loan Against Property