How is home loan eligibility calculated by banks?

Banks typically use the 50-60% FOIR (Fixed Obligation to Income Ratio) rule. Your EMI should not exceed 50-60% of your monthly income. Eligibility = Monthly income × FOIR × 12 × Loan tenure in years / (Interest rate × 0.01). Factors include age, income stability, credit score (750+), existing loans, and property value. Co-applicant income can boost eligibility by 50-100%.

What is the maximum home loan tenure in India?

Maximum home loan tenure is typically 30 years (360 months). However, loan must be repaid before you turn 65-70 years old. Longer tenure reduces EMI but increases total interest paid. For example, on ₹50 lakh at 8.5%: 20-year tenure = ₹43,390 EMI with ₹54L interest; 30-year tenure = ₹38,449 EMI with ₹88L interest.

Can I get 100% home loan financing in India?

Most banks offer 75-90% LTV (Loan to Value) ratio. For loans up to ₹30 lakh, LTV can be 90%. For ₹30-75 lakh, 80% LTV. Above ₹75 lakh, 75% LTV. You need 10-25% as down payment. Some banks offer 100% financing for government employees or under special schemes, but with higher interest rates.

Loan Calculator

Home Loan Eligibility Calculator

Calculate maximum home loan amount based on your income and existing obligations

Income Details

Monthly Income (₹) *

Existing EMIs (₹/month)

Include all existing loan EMIs

Loan Tenure (years) *

Interest Rate (% per annum) *

Home Loan Eligibility Guide

Eligibility Factors

• Income level and stability of employment
• Age (18-70 years, higher eligibility at younger age)
• CIBIL score (750+ gets best rates)
• Existing loan obligations (FOIR ratio)

How It Works

• Banks use 50-60% of income for EMI calculation
• Typical loan-to-value ratio is 80-90%
• Interest rates: 8.5-9.5% (Jan 2026)
• Processing fee: 0.25-1% of loan amount

Frequently Asked Questions

How is home loan eligibility calculated?

Banks use FOIR (Fixed Obligation to Income Ratio), typically 50-60% of net monthly income. Formula: Max EMI = (Net Income × 0.5) - Existing EMIs. From this EMI, loan amount is derived using interest rate and tenure. Eligibility also depends on age, CIBIL score (750+), and employment stability.

What is the maximum home loan I can get?

Typically 80-90% of property value (LTV - Loan to Value ratio). For properties up to ₹30L: 90% LTV. Above ₹30L: 80% LTV. Some banks offer 95% for affordable housing. Your income-based eligibility and property value-based limit - whichever is lower - determines your max loan amount.

What documents are required for home loan application?

Identity proof (Aadhaar, PAN, passport), Address proof, Last 3 months salary slips, 6 months bank statements, Form 16/IT returns (2 years), Property documents (sale agreement, NOC, approved plan), Employer ID card. Self-employed need business proof, IT returns, audited financials.

What are current home loan interest rates in 2026?

As of January 2026, rates range from 8.5% to 9.5% p.a. depending on lender, loan amount, tenure, and your credit profile. CIBIL score 750+: Best rates (8.5-8.8%). Below 750: Higher rates or rejection. Women borrowers and existing customers may get 0.05-0.10% concession.

Can I get a home loan for property in another city?

Yes, you can get a home loan for property anywhere in India regardless of your current location. Bank may require property inspection, legal verification, and approved builder/project. Interest rates and processing may be similar, but property valuation and legal due diligence become more critical.

What are the tax benefits on home loans?

Interest deduction: Up to ₹2 lakhs under Section 24(b) for self-occupied property. Principal repayment: Up to ₹1.5 lakhs under Section 80C. First-time buyers: Additional ₹50K under Sec 80EE (conditions apply). Only available in old tax regime, not in new regime.

How to Use This Calculator

1
Enter your net monthly income (take-home salary after deductions). This is the primary factor for loan eligibility.
2
Add existing EMIs (personal loan, car loan, credit card EMIs). This reduces your available income for home loan EMI.
3
Select desired loan tenure (typically 15-20 years) and current interest rate (8.5-9.5% in 2026).
4
Click 'Check Eligibility' to see maximum loan amount, property value you can afford, down payment needed, and monthly EMI.

Key Terms & Definitions

FOIR (Fixed Obligation to Income Ratio): Percentage of income that can go towards loan EMIs. Banks typically allow 50-60%. Higher ratio means higher eligibility.
LTV (Loan to Value Ratio): Maximum loan as % of property value. Typically 80-90%. Higher property value may have lower LTV. Remaining is down payment.
CIBIL Score: Credit score (300-900) indicating creditworthiness. 750+ required for best rates. Below 650 may lead to rejection or higher rates.
Processing Fee: One-time fee charged by bank for loan processing, typically 0.25-1% of loan amount. Some banks waive during festive offers.
EMI (Equated Monthly Installment): Fixed monthly payment towards loan comprising both principal and interest. Initially interest is higher, later principal increases.

Formulas & Calculations

Maximum EMI Calculation

Max EMI = (Net Monthly Income × 0.50) - Existing EMIs

Banks use 50% FOIR. Example: ₹1L income, ₹10K existing EMI → Max new EMI = (₹1L × 0.5) - ₹10K = ₹40K.

Loan Amount from EMI

Loan Amount = [EMI × (1 - (1 + r)^-n)] / r Where: r = Monthly interest rate, n = Tenure in months

Example: ₹40K EMI, 9% rate, 20 years → Loan ≈ ₹44.5L. At 90% LTV, you can buy property worth ≈₹49.4L (₹4.9L down payment).

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