Home Loan Affordability Calculator

What affects home loan affordability?

Home loan affordability is influenced by a variety of factors such as those given below:

• Age: A younger individual has a higher chance of getting a higher loan amount and being approved for a loan as he has more number of years ahead and his earning ability may increase with age. An older individual, on the other hand, may have lesser number of earning years ahead of him with his earning capacity reaching a plateau soon.
• Income: Your income is a crucial factor in your home loan affordability. Your take-home salary after deductions and tax will give you a better picture of how much you can comfortably repay.
• Income stability: An individual with a steady and stable income is more likely to get a loan than one with an irregular income.
• Expenses: Your monthly expenses will have to be taken into account before you decide how much loan you can afford to take.
• Existing EMIs: Existing loans and their EMIs are an important factor when calculating your home loan affordability. To increase it, you could consider closing existing loans so that you have more cash on hand to pay for a home loan.
• Credit score: A higher credit rating makes the loan approval process faster and easier and vice versa.
• Rejected loan applications: If you have had prior loan applications rejected, it will negatively impact your Credit Score.
• Collateral/security: Any collateral like land or gold that can be used as security will increase your chances of getting a loan and a higher amount as a secured loan is a lot less riskier than an unsecured one.