Buying your own home is a dream come true for most individuals, and with many development projects going on, the situation is ripe for you to make the big move. To make the deal further lucrative for you, many developers are offering great discounts and deals also. But with the real estate becoming expensive, it is not possible for anyone to buy their own home from just their savings. This is where Home Loans comes to your rescue.
A Home Loan is the loan extended by private as well as public sector financial institutions against the purchase of a residential property. But as the amounts availed against loans for the home are considerably higher and run into lakhs of rupees, if not crores. Also, the tenure of a Home Loan is substantially more and usually goes up to 20 years, the financial institutions follow a stringent criterion to determine Home Loan Eligibility.
Usually, to satisfy the eligibility requirements, multiple family members are brought on to the application. As such, when the income of multiple family members is combined, the processing of an application for loans for home has higher chances of success. But sometimes, it is possible that there is only one earning member in the family, now what to do in such situations?
Buying a Home on Single Income
With rapid changes in the Indian society, nuclear families have become the norm in cities. In such scenarios, it is very likely that there is only one earning member in the family. Now, if you are also part of such a family and are now considering buying your own home, then you should be aware of the facts that have been mentioned above. If you have enough money to make an outright purchase, then it is terrific. But as is the case with most people, you might also need to avail a Home Loan to buy your own home.
Here we have compiled a few useful tips that you should consider for improving your Home Loan eligibility: –
- Make a significant down-payment: – The best strategy for you in such a situation would be to accumulate your savings and make sure that you make at least 20-25% of the loan amount as down payment. That way you will have to avail a lower amount as a home loan, and financial institutions will be happy to process your application based on single income as this shows the lenders that you have goodfiscal
- Manage your Credit Score: – Most financial institutions check your credit score before processing your application. Having an excellent credit score will ensure the lenders about your creditworthiness,and they will not hesitate to process your application, even if you are a single applicant.
- Avail Home Loan Insurance: – No matter the amount of the loan you are availing, you must subscribe to a home loan policy. This guarantees the lenders repayment of the amount in case of any mishap and also protects the remaining family members if anything untoward happens to the sole breadwinner of the family.
- Co-applicant or Guarantor: – You can also ask some of your friends or relatives to come on the home loan application as a co-applicant or guarantor. This way while calculating the eligibility for a Home Loan, the lenders will take into the account income and assets of the co-applicant or guarantor as well. But you must remember that in case of any defaults, the lenders will go after the co-applicant or guarantor for recovery of their dues. So, explain the consequences to the person before you ask for their help.
- Ask your developer: – If you are considering buying a property being developed by a renowned developer, then you can ask for their assistance. Most developers have tie-ups with various banks as well as NBFCs (Non-banking financial corporations) and can help to get your loan application approved. The developers have a good understanding as to with which lender your application is likely to get accepted and will, therefore, guide you accordingly.
- Downsize: – You can reduce the amount of loan required by opting for a smaller property size or choose a less expensive locality. As the value of a more modest property or a property at a non-expensive locality is bound to be lower, you will need to take only a small amount as a home loan, which could be quickly approved even on your single income.
Buying own house is a dream come true for many, with careful planning and due diligence, you can get your home loan application approved even on a single income. Remember there are numerous lenders in the market who will process the application of Home Loans for you at home also.
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Talk to our Loan Specialists toll-free at 1800 103 4004 to know more about our products and offers.
