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Axis Bank Home Loan Eligibility
Computing your home loan eligibility can be quite cumbersome, owing much to the fact that it is rarely explained in a manner that is easy to understand. Here we explain with an example the process of determining an individual’s Axis Bank home loan eligibility.
Part of income available for paying EMIs:
Let us suppose an individual is drawing a net salary of Rs 30,000 per month. Some home loan companies will consider 55 per cent of the net monthly salary as being available for EMI payments. In this example, the amount works out to Rs 16,500 (i.e. 55 per cent of Rs 30,000). The portion of salary available for paying EMIs varies with an individual’s income. A higher salary relates to a higher percentage. This is because a higher salary means a higher disposable income, and therefore a higher amount available for EMI payments.
Understand your home loan eligibility:
Axis Bank and other home loan providers have their own official EMI table. It lists the monthly EMIs per lakh, for varying interest rates and loan tenures. Here we show you how to calculate home loan eligibility using an example.
Let us assume an interest rate of 8% and a tenure of 20 years. Let us say the table gives us an EMI per lakh of Rs 836 for the assumed interest rate and tenure. Now, this EMI per lakh and the amount available for paying EMIs, as calculated above, is what determines an individual’s home loan eligibility. To be precise, we divide the amount available for making EMI payments, which is Rs 16,500, by the EMI per lakh, which is Rs 836. By doing so, the home loan eligibility comes out to be approximately Rs 19.7 lakhs.
Not all home loan providers use the same method for calculating home loan eligibility, but the basic logic remains the same. Some have a different percentage structure, while some calculate the percentage of salary available for EMIs based on an individual’s gross salary rather than the net salary. Also, the calculations will differ in case of self employed individuals.
In addition to the above, some intangible factors also affect home loan eligibility. They are:
Profession of an individual: Home loan providers usually have an unofficial list of “negative professions”. It is a real ordeal for individuals in a so-called negative profession to acquire a home loan.
Property location: Housing finance companies (HFC) also have a list of “negative locations”. Getting a home loan to buy a property in one of those negative locations is easier said than done. All HFCs set geographical limits. For the HFC to offer you a home loan, your selected property must fall within the geographical limits set by the HFC.
Personal profile of the individual: There are a few other factors related to an individual’s personal profile that help in deciding the individual’s home loan eligibility. These factors include, but are not limited to, his credit score (credit repayment history), saving habits, and number of people dependent on him financially.
It would be wise on your part to understand the basics of home loan calculations prior to getting a home loan. This will aid you in determining the portion of your income available for making EMI payments. Armed with the right information, you can go ahead and select the best offer from Axis Bank home loan.
Axis Bank Home Loan Calculator
Buying your own house is a big decision that requires careful planning. This is because it is probably the biggest financial decision that you will ever make. You need to ensure that the house fits your budget. Thankfully, Axis Bank home loan makes the process a lot easier. You can use the Axis Bank home loan calculator to find out if the house you plan to buy fits your budget.
Axis Bank’s home loan offers are designed while keeping in mind the needs of consumers. With features like attractive interest rates, balance transfer facility and flexible tenures, Axis Bank home loan is the best deal available today. You have the option to choose between flexible and fixed interest. The bank recently launched ‘NISHCHINT’, a lifetime fixed interest home loan scheme which offers home buyers loans at a fixed rate of 11.75 per cent for the entire duration of the loan that is up to 20 years. Under the floating rate scheme, the bank offers a minimum interest rate of 10.75%. Whether to opt for fixed or floating rate loan is solely your decision. Take into account the current market scenario; this will certainly aid you in making your decision. As an example, if the market trend suggests that the interest rates will not change much in the coming years, it is advised to get your loan locked at a fixed rate. Then again, if you feel that the rates will fluctuate a lot and might drop down from the current numbers, you should choose the floating rate offer, since it will average out your EMIs.
Home loans are offered by the bank for several purposes including construction of house, purchase of a new house or purchase of land. They can also be availed for extension, renovation or repair of your existing house. Axis Bank even offers takeover of an existing home loan. The amount of loan you can get varies according to the purpose of the loan. You may apply for up to 85% of the property value in case of home loans and up to 75% of the property value for extension, renovation or repair. You can lower your EMI by increasing the loan tenure; the bank offers a maximum tenure of 25 years.
Axis Bank charges a processing fee of 1%, which is nominal relative to other banks. Moreover, prepaying an Axis Bank home loan does not incur any early redemption charge, in comparison to other banks who have 2% prepayment charges.
Axis Bank’s offers surely look attractive but you still need to do necessary calculations to figure out a loan tenure and EMI that best suits your budget. With the right tools at your disposal, you can easily turn your dream home into a reality. To get the information on the installment amount is the easiest part today with the help of a loan EMI calculator. All you have to do is enter the loan amount along with the desired period and you will get the amount of EMIs calculated automatically. You can change the tenure to find out the most desired EMI that fits your pocket in the best possible way.