Purchasing a home is one of the most important financial decisions of your life. You have to spend each and every penny with utmost care. Due to the rising prices of real estate in India, it has become almost impossible for a middle class buyer to purchase a home without the help of home loan. There are numerous aspects of getting the right home loan from the right lender.
In spite of applying for a home loan after much research, there are chances that your home loan application might be denied by the lender bank. You have to learn about the risk areas that can lead to your home loan rejection. Some of the reasons are generic and apply to almost all the applicants; however, some reasons may also be specific to a particular applicant.
First of all, the banks check your capability to repay the loan. For this they check your credit score. Timely payment of credit card bills, telephone bills, existing EMIs, insurance premium give a fairly strong credit score. On the other hand, if you accumulate these bills it will result in a poor credit score. So in order to save your home loan application from being rejected, make sure you pay all your bills in time.
Secondly, your home loan lender would also want to make sure that you have a stable job so that you can repay the amount loaned to you. For some banks, it is mandatory to be associated with a particular company for a certain period of time, in order to be eligible for loan. Some banks also mind the age concern for the same. For example, if you are inching closer to retirement age, banks would not be willing to offer you a loan, since your repayment capacity is expected to go down after a few years.
Thirdly, if you are a guarantor to someone who has been a defaulter, it can also affect your home loan application. So, if you are planning to get a home loan in near future, be cautious about signing any such thing. Also, you should avoid applying for home loan with several banks at the same time. If a particular bank rejects your loan application, it adversely affects your credit score.
Make sure that the property you are buying is being constructed according to the policy guidelines as it also affects your chances of getting a home loan. Be prepared and go out there like a pro.
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