Home loan eligibility refers to a lender’s assessment of your ability to repay a loan. It depends on factors such as income, age, credit score, and financial obligations. Knowing these parameters helps you plan better and improve your chances of loan approval.

Your income is the key foundation of home loan eligibility criteria. Lenders evaluate whether your earnings are consistent and sufficient to manage EMIs comfortably.

Applicants with stable jobs or regular business income are often preferred, as this indicates steady cash flow. Most lenders expect at least two years of continuous employment for salaried individuals or three years of profitable operations for self-employed professionals. Maintaining proper income documentation and filing taxes regularly enhances your credibility.

Your age determines how long you can repay the loan. Younger borrowers typically enjoy longer repayment tenures, which reduce EMI pressure. For example, someone aged 30 may get a 25-year tenure, whereas someone aged 50 might be restricted to 10–15 years.

Lenders aim to ensure the loan is fully repaid before retirement. If you’re nearing retirement, adding a younger co-applicant can help increase eligibility.

A good credit score indicates responsible financial behaviour. Most lenders prefer a score above 750. It reflects timely payments, low credit utilisation, and prudent borrowing habits.

Missed EMIs, loan defaults, or multiple loan applications can negatively affect your eligibility. Even a small improvement in your score can significantly increase approval chances and help you negotiate better interest rates.

Your current EMIs, credit card dues, and other liabilities influence how much you can borrow. Lenders assess your debt-to-income (DTI) ratio — the percentage of your income that goes towards debt repayments.

A DTI above 50% can limit your eligibility. Paying off smaller loans or consolidating high-interest debts before applying can improve your financial standing and overall loan prospects.

The property’s value also affects the loan amount you can secure. Lenders generally fund 75%–90% of the property’s market value, depending on internal policies. 

For example, if your property is valued at ₹60 Lakhs and the lender’s LTV cap is 80%, you can borrow up to ₹48 Lakhs. A higher down payment reduces the LTV ratio and demonstrates stronger repayment commitment.

Lenders evaluate your employment type to understand income stability and repayment reliability. Salaried individuals working with reputed companies are generally seen as lower-risk borrowers due to steady income and job security.

Self-employed applicants, on the other hand, must show consistent earnings and business stability through audited financials and tax returns. For example, say you choose India Shelter Finance Corporation Limited and apply for an India Shelter Home Loan.

As a lender, India Shelter will assess both your income consistency and employment background before approving the loan, just as most housing finance institutions do when determining borrower eligibility.

Including a co-applicant can enhance your eligibility. The combined income allows you to qualify for a higher loan amount and potentially better terms. Joint loans are common among spouses or family members who share ownership of the property. However, both applicants carry equal repayment responsibility.

Maintain a credit score above 750 through timely repayments

Clear existing debts before applying for a new loan

Choose a longer repayment tenure for manageable EMIs

Make a higher down payment to lower the LTV ratio

Include a co-applicant with a steady income

Keep all financial documents accurate and updated