Age is a significant factor in determining the housing loan eligibility of an applicant. If an applicant belongs to a higher age bracket, the chances of their application’s acceptance can be lower, in comparison to the younger demographic. This is because the home loan tenure would fall primarily in the applicant’s retirement period. Nevertheless, lenders are now willing to credit a home loan to applicantsup to the age of 75 years.
Are you planning to take out a home loan in your 50s? If yes, then here are some tips to assist you in the process.
- Additional Source of Income
Generally, lenders check your current income as well as your income post-retirement to assess your home loan eligibility. Thus, to enhance yourhousing loan eligibility, you should includean additional source of income such as rental income in your monthly cash inflowsto show improved loan repayment capacity.
- Choose a Shorter Tenure
Although a shorter tenure would mean a higher EMI, it is a convenient option for home loan borrowers nearing the retirement age as the interest outgo will be lesser. Besides, applicants can use a home loan EMI calculator to estimate the cost of borrowing by checking the home loan interest rates and the loan amount that they are eligible for. Through this, they can also ensure, if the EMI plan suits their monthly budget or not.
- Take Out a Joint Loan
You can vastly improve your housing loan eligibility by taking out a joint loan. When you apply for a home loan with a co-applicant, preferably from a younger age bracket, your financial capacity increases and as a result, your creditworthiness goes up. Additionally, bothco-applicants can also take advantage of the tax benefits under Sections 80C, 24, and 80EE.
- Go for a Higher Down Payment
Mostly, the down payment for a home loanfalls between5% to 25% of theproperty value. However, applicants can use their savings, depending on their age and capacity,to make a higher down payment. As a result, the amount of the EMIs go down, and servicing the home loanbecomes easier; thus, improving your housing loan eligibility.
- Check Your Creditworthiness
Your credit report is one of the first things a lender checks when you apply for a home loan. To lower the chances of rejection, clear your outstanding credit dues before you apply for a loan and build a good credit report. Ensure you have a CIBIL score of 750 and above, as it reflects a higher capacity for home loan repayment. Besides, you can also avail a larger loan amount with a higher CIBIL score.
Even though the age of the borrower is a crucial eligibility factor, lenders are now offering flexible eligibility conditions for applicants from the higher age bracket. However, to ensure a smooth transaction, applicants can implement thetips mentioned above to optimize their housing loan eligibility and enhance their chances of home loan approval.
Are you above 50 and looking to avail of a home loan? If yes, then get in touch with Tata Capital. We offer home loans at competitive ROIs and with minimal documentation. We also recommend you to check home loan eligibility by logging on to our website today!