To find the easiest way to opt for home construction loans in India, it is advised to keep in mind the eligibility criteria and also how to improve your loan eligibility to avail a faster disbursal of the same.
Eligibility criteria
Meeting the demands of the eligibility criteria set by financial institutions will help you to avail a construction loan without any hassle.
These criteria are –
- Age
The age bracket considered to avail home construction loans is approximately 23 to 62 years of age.
- Income
Financial institutions require salaried individuals to have a minimum monthly income of Rs.20,000 to approve their home loan application.
- Documents
Borrowers are required to provide the following documents when applying for home construction loans –
- KYC documents such as PAN card, Passport, Aadhaar card, etc.
- Form16 or latest salary slips.
- Address proof.
- Bank account statements.
- Proof of business vintage for at least 5 years for self-employed applicants.
Additional Read: Ways to Get a Construction Loan With Ease
Factors to consider to improve your loan eligibility
Considering the following factors, you can improve your home loan eligibility –
- Possess a FOIR of 35% to 40%.
- Make a higher down payment.
- Opt for a shorter tenor.
- Select between a floating interest and fixed interest rate.
In addition to the above, borrowers must also remember to avail income tax benefits on home loans. Under Section 80C, they can avail deductions of up to Rs.1.5 lakh on the principal repaid. Similarly, under Section 24(b), borrowers can avail exemptions of up to Rs.2 lakh on the interest paid.
