Contents
- 1 Loan Eligibility Calculator — Home, Personal, Car & LAP
Loan Eligibility Calculator — Home, Personal, Car & LAP
Check loan eligibility based on income, existing EMIs, tenure and interest rate. Includes FOIR, CIBIL impact and Indian bank multipliers.
Visual Breakdown
What Determines Loan Eligibility?
Banks evaluate three core factors: repayment capacity (income), creditworthiness (CIBIL score), and collateral (for secured loans). Eligibility = function of all three. Even with high income, a low credit score reduces eligibility; even with good credit, low income caps the loan amount.
The FOIR Concept
FOIR (Fixed Obligation to Income Ratio) is the % of your income that goes to EMIs (all existing + new loan). Banks cap FOIR by loan type:
| Loan Type | Max FOIR | Why |
|---|---|---|
| Home Loan | 50-60% | Secured by property; higher FOIR accepted |
| Loan Against Property (LAP) | 55-60% | Secured but riskier than home loan |
| Car Loan | 50% | Secured by vehicle (depreciating asset) |
| Personal Loan | 40-50% | Unsecured; strict limits |
| Credit Card | 30-40% total spending limit | Highest risk; conservative |
CIBIL Score Impact on Eligibility
| CIBIL Score | Interest Rate | Eligibility |
|---|---|---|
| 800-900 (Excellent) | Lowest available (banks compete) | Full eligibility, best terms |
| 750-799 (Very Good) | Standard rate | Full eligibility |
| 700-749 (Good) | +0.25-0.5% above standard | ~90% of normal eligibility |
| 650-699 (Fair) | +1-2% above standard | Reduced eligibility, co-applicant may help |
| 550-649 (Poor) | +3-5%; only NBFCs | 30-50% of normal; collateral needed |
| <550 (Very Poor) | Limited to gold loan / LAP | Mostly rejected |
Income Eligibility Multipliers
Banks typically lend a multiple of your annual income:
| Loan Type | Typical Multiplier |
|---|---|
| Home Loan (salaried) | 60-72× monthly income (5-6× annual) |
| Home Loan (self-employed) | 40-50× monthly income (3-4× annual) |
| Personal Loan | 10-25× monthly net income |
| Car Loan | 30-60× monthly net income |
| Loan Against Property | 60-70% of property value (subject to FOIR) |
Tenure & Age Limits
| Loan Type | Max Tenure | Max Loan Maturity Age |
|---|---|---|
| Home Loan | 30 years (some 40) | 70-75 (salaried), 65-70 (self-employed) |
| Personal Loan | 5-7 years | 60 (salaried), 65 (self-employed) |
| Car Loan | 5-7 years | 60-65 |
| LAP | 15-20 years | 65-70 |
Tenure is capped by (a) loan type max, (b) age-at-maturity, whichever is lower. A 50-year-old can get max 20-year home loan if retirement age is 70.
Documents Required
Salaried
- 3 months’ salary slips + Form 16 (current + 2 years)
- Bank statements (6 months)
- PAN, Aadhaar, address proof
- For home loan: property documents, builder agreement, NOC
Self-Employed / Business
- 3 years ITR + computation of income
- P&L and Balance Sheet (last 3 years, audited)
- Bank statements (12 months, current + savings)
- GST returns (6-12 months)
- Business registration documents (Udyam, Shop Act, etc.)
How to Maximise Your Eligibility
- Add a co-applicant (working spouse) — combined income roughly doubles eligibility
- Close existing EMIs first — every ₹10K of cleared EMI = ~₹10L more home loan capacity (depending on tenure)
- Maintain CIBIL ≥ 750 — pay credit card bills on time, no missed EMIs, low credit utilisation (<30%)
- Choose longer tenure — 30 years vs 15 years can double your loan capacity (but increases total interest)
- Negotiate processing fee waiver — most banks waive 50% for salaried customers with strong profile
- Show all income sources — rental, freelance, dividend, interest — declared in ITR boosts eligibility
- Avoid recent loans/credit cards — multiple credit inquiries in 6 months hurt score and signal cash crunch
Frequently Asked Questions
What’s the difference between FOIR and DBR?
FOIR (Fixed Obligation to Income Ratio) is for retail loans — banks/HFCs use it. DBR (Debt Burden Ratio) is the same metric used by some NBFCs. Both calculate the share of income consumed by EMIs. Lower = better.
Can I get a home loan with low salary?
Yes — affordable housing schemes (PMAY) and joint loans help. Banks have minimum income criteria (typically ₹15K-25K/month for salaried), but combining spouse’s income, declaring all sources, and choosing a smaller property all increase chances.
Does my employer matter for loan eligibility?
Yes — banks classify employers into categories (Cat A: Govt, large MNCs, Fortune 500; Cat B: medium companies; Cat C: SMEs; Cat D: unlisted/unknown). Higher categories get better rates and easier approval.
How much processing fee do banks charge?
0.25-2% of loan amount (typically 0.5-1%). Often negotiable to 0.25% for good profiles. Many banks waive partially during festive offers or for women borrowers.
Can self-employed get the same loan as salaried?
Eligibility is usually 60-70% of salaried (banks see business income as more volatile). However, well-documented businesses (3+ years ITR, audited financials) with consistent income can match salaried rates.
Does pre-approved loan offer mean guaranteed approval?
No — ‘pre-approved’ is based on existing customer data and indicative. Final approval requires fresh documentation, valuation, and verification. Up to 5-10% of pre-approved loans are eventually rejected at final stage.
What is balance transfer (BT)?
Transferring existing loan from one lender to another offering lower rate. Charges: 0.5-1% processing fee + foreclosure charges (if any). Typically worth it if you can save 0.5% rate AND remaining tenure > 5 years.
How is loan eligibility different for NRIs?
NRIs need NRE/NRO income proof, employment letter from foreign employer, salary slips converted to INR. Loan tenure capped at 15-20 years, max loan often lower than residents.
Can I get loan with credit card debt?
Yes but credit card EMIs count towards FOIR, reducing eligibility. Better: clear credit card before applying. ₹50K/month CC commitment alone reduces home loan eligibility by ₹40-50L.
What’s loan-to-value (LTV) ratio?
Maximum loan as % of property value. RBI mandates: 90% LTV for ≤₹30L, 80% for ₹30-75L, 75% for >₹75L home loans. LAP typically 60-70% of property value.
Do home loans have minimum loan amount?
Yes — typically ₹3-5 lakh minimum. Some banks offer ₹1 lakh starting (for rural/affordable). Maximum is income-driven, can go to ₹10+ crore for HNIs at private banks.
Can I get loan with cash salary?
Difficult. Banks insist on banked salary credits (salary directly to account via NEFT/RTGS). Cash salary creates documentation issues. Workaround: provide IT returns + bank deposits showing pattern + employer NOC.