Afraid of Getting Home Loan Application Rejection?

Home holds a very special please in our heart. It is not mere an address but it somewhere becomes the part of our identity. We all wish to have our own home and we start saving for it from an early age itself but with the sky rising prices of property, buying a home with our own funds becomes a herculean task. To deal with such kind of situation, home loan comes as a sight of respite. It not just meet the shortfall of funds but also increase your budget.

With online applications, applying for home loan has become very easy and if your documents are proper then you can get approval within few days itself. Try to follow these simple steps to get your application approved:

Maintain a healthy CIBIL score- Yes CIBIL score plays a very important role in getting your loan approved. A score of 750 plus is considered healthy for lending while anything less than 600 is considered poor. It is the first thing that a landing institution checks. Try to settle your previous/ongoing dues before applying for a home loan. This will upgrade your credit score. The score will improve over a period as the dues are cleared, allowing you to avail of loans as per requirement.

Pay your credit card bills on time: Delayed, partial or skipped credit card bill payments can negatively affect your credit score. Make a note not to exceed your credit limit, use only 30% of the limit to maintain a good credit score.

Must Read : 7 Smart Tips To Improve Your CIBIL Score Immediately

matters – Financial institute provide you home loan on the basis of your paying capacity. Chances of getting a home loan at an early stage of career, say 20’s or 30’s with a stable income are higher than at a later stage. This is because home loan tenures are generally longer and lending money to a borrower who is nearing to retirement as it is harder to advance a loan to him or her for an extended period like 25-30years. But in this scenario go for a shorter term, though your EMI will be higher but your chances of approval increases and you would be paying less interest due to smaller tenure.

Know beforehand how much loan you can apply for- Try home loan calculator to know how much loan you can get. You need to see that your fixed obligation to income ratio (FOIR) like your EMIs, should not exceed 50% of your monthly income. If you have an existing loan, try to add your spouse or family member as a co-applicant, given he/she is gainfully employed too to increase your borrowing potential.

Job Stability- An applicant who has been there in the present job for at least two years is preferred over someone who has had too many job changes in a short while. All paperwork are in place- Proper documentation like your income proof, KYC , updated bank statements are some of the essentials required for swift approval of home loan application. If your loan application gets rejected in the first instance, do not keep applying for it as it would only reduce your creditworthiness showing you to be credit hungry. Instead, work on your eligibility before you reapply.

Go for a reputed builder- Before you finalize your home make sure that a reputed builder builds it and all the documents are legal. Banks prefer properties with clear titles, good resale value and no minor rights.

Too many applications in a short time frame: If you apply for loans from multiple sources within a short period of time, it signifies that you are short of credit and need to apply to several sources to make up the shortfall. Lenders are worried that you will not be able to repay your loan and will be inclined to reject your application.

Must Read : Tips To Make Home Buying Process Less overwhelming