Having a place of your own is a lifetime achievement. Hence, when one decides to buy a house and apply for a home loan, he/she should carefully meet all the prerequisites necessary for getting the loan sanctioned. Any shortcomings in the process can hamper their dream of buying a house. There could be numerous reasons for a home loan rejection, like:
Their CIBIL score - A bad or low credit score can have a poor impact on the lender and can lead to near sure shot rejection of the home loan application. Therefore, it is always advisable to maintain their credit score by being aware of all the repayments and dues. In addition, it will give the impression of their loyal and punctual history with the earlier debts.
Age of applicant- If the applicant is apply for home loan at an earning age, there stands no problem in applying for a loan but on the contrary, if the applicant is close to retirement, his/her home loan application may get rejected. The possible reason being the limited and unstable income which can result in zero/limited repayment capacity.
New or unstable job - Changing jobs frequently can have a negative impact on their home loan application. To be considered for a home loan, banks require that the borrower be working in a specific organisation or corporation for at least three years. If sometimes the applicant’s company seems unstable, the bank reserves its right to reject the loan.
Loan guarantor to be defaulter- Being a loan guarantor might be dangerous at times. A person should not accept to be a loan guarantor unless they are confident in the applicant’s ability to repay the debt because if the beneficiary fails to repay the loan, the guarantor will be held liable to repay it vicariously.
Previously rejected loan applications- CIBIL keep track of things like loan application rejections, and if there are rejections in their name, the borrower should wait for 6-12 months before applying again.
Address on defaulter’s list- If the borrower has moved to a previously rented property by someone who hasn’t paid off large credit card bills or made a loan payment. In addition, if the prior tenant or owner provided the same address in the bank records, the address may be placed in the defaulters’ database. This lowers their chances of getting a house loan authorised.
Armed with the information the borrower needs to know to avoid home loan rejections, he/she can now apply for the home loan with the right lender confidently. Just make sure that all records, such as the credit score for the home loan are clear. One can use a home loan calculator for such calculations. A great option to consider for a home loan in India is with the various HFC’s. They feature a competitive home loan interest rate, a flexible loan tenor of up to 360 months, and an ample sanction, perfect for their home purchase needs. All the applicants have to do is meet the easy home loan eligibility criteria, apply online on their website, furnish essential documents, and await loan approval.
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