The Loan Eligibility Calculator is a powerful tool designed to help you estimate the maximum loan amount you can borrow from a bank or financial institution. Whether you are planning to buy a new home, a car, or take a personal loan, knowing your eligibility beforehand helps in better financial planning.
Banks typically determine your loan eligibility based on your Net Monthly Income and your Fixed Obligation to Income Ratio (FOIR). Most lenders assume that about 50% of your monthly income is available for servicing debt (EMIs), while the other 50% is needed for living expenses.
How It Works
- Enter Income: Input your net monthly take-home salary.
- Interest Rate: Enter the expected interest rate for the loan.
- Tenure: Specify the duration for which you want to take the loan.
- Existing EMIs: If you have any other ongoing loans, enter their total monthly EMI amount.
The calculator then computes your Disposable Income (Income available for new EMI) and reverse-calculates the maximum Principal amount you can borrow such that the EMI equals your disposable income.
Factors Affecting Eligibility
- Income: Higher income usually means higher eligibility.
- Age: Younger applicants can opt for longer tenures, increasing eligibility.
- Credit Score: A good credit score (750+) boosts your chances and may get you better rates.
- Existing Debts: High existing EMIs reduce your repayment capacity for new loans.