1. What is Home Loan Eligibility?

The home loan eligibility calculator determines the maximum loan amount you can qualify for based on your repayment capacity, interest rate, and loan term. It uses standard banking formulas similar to those used by ICICI and HDFC banks.

2. How Does the Calculator Work?

The calculator uses the present value of annuity formula:

Where:

• \( P \) — Principal loan amount (INR)
• \( PMT \) — Monthly payment you can afford (minimum ₹30,000)
• \( r \) — Monthly interest rate (annual rate ÷ 12)
• \( n \) — Total number of monthly payments (years × 12)

Explanation: The formula calculates the present value of a series of future payments (annuity) to determine the maximum loan amount.

3. Importance of Loan Eligibility

Details: Knowing your maximum eligible loan amount helps in budgeting for your home purchase and negotiating with lenders. It prevents disappointment from applying for loans beyond your repayment capacity.

4. Using the Calculator

Tips: Enter your comfortable monthly payment (minimum ₹30,000), current interest rate, and desired loan term. The calculator will show the maximum loan amount you qualify for.

5. Frequently Asked Questions (FAQ)

Q1: Why is there a minimum monthly payment of ₹30,000?
A: This reflects typical bank requirements for minimum income levels for home loan eligibility.

Q2: How accurate is this calculator?
A: It provides a good estimate, but actual eligibility may vary based on credit score, existing debts, and lender policies.

Q3: What factors affect my loan eligibility?
A: Income level, credit score, existing debts, property value, and interest rates all impact your maximum loan amount.

Q4: Should I borrow the maximum amount I qualify for?
A: Not necessarily. Consider your overall financial situation and future expenses before committing to maximum payments.

Q5: How can I increase my eligibility?
A: You can increase eligibility by improving credit score, reducing other debts, adding co-applicants, or choosing a longer loan term.