8 Factors That Can Impact the Decisions of Lenders to Lend Money to Home Buyers

8 Factors That Can Impact the Decisions of Lenders to Lend Money to Home Buyers

Purchasing a home is undoubtedly one of the greatest achievements of any person. However, most people fail to purchase their homes because they do not have the capital that is required. In this situation, they prefer taking home loans. Any private lender or financial institution is going to sanction the home loans based on various conditions. Lenders are going to evaluate every home loan application based on stringent policies. You need to understand that other than the parameters that are responsible for deciding whether you are going to receive a home loan or not, other important factors can impact the prospect associated with receiving home loans. These factors include age, credit history, income, place of residence, etc. You need to know about all these factors so that you can pass the process of home loan application easily.

Given below is a list of the factors that can impact the eligibility of getting a home loan.

Your age

The eligibility to receive a home loan is estimated for a particular period, which is referred to as the "tenure". The tenure is dependent on the age along with your ability to clear it within a stipulated period. The ability of any young applicants to clear his loan is going to be different and unique in comparison to the ability of a middle-aged individual or any retired person. A home loan borrower is going to face separate challenges in different phases of his life. Lenders, as well as financial institutions giving home loans, are going to evaluate these factors before sanctioning the loan. If you budget and plan properly, it will be easier for you to overcome all the obstacles that the people belonging to your age group are facing, and it is not going to be difficult to look for the best option that is available.

Qualification as well as experience

If the academic credentials, as well as work experience, are good enough, the odds associated with lenders sanctioning the home loan is going to be high. For instance, if there is a salaried individual, he needs to have almost 3 years of experience in one particular organization to get a home loan. Similarly, if an individual is self-employed and the organization is operating for more than 2 years, and you can show revenues and cash profits, it is not going to be difficult to receive a home loan. You should also file tax returns every year to be eligible for the home loan. Academic qualifications along with the work experience can be responsible for jointly predicting the career progress as well as your stability shortly, which will help the lenders to make a decision.


There is no denying the fact that your income is going to determine whether you will be able to clear the loan that you are taking. This is true in case of any loan that you decide to take. Your income is the minimum eligibility requirement that will help in deciding whether or not you are fit enough to clear the loan amount within the stipulated time. Higher the income, greater is going to be the chances of banks as well as lenders lending money to you. Lenders insist that every applicant should have a particular income level to meet the eligibility of home loans. This is going to vary based on the profession that you are associated with. The eligibility to receive a home loan is always calculated based on your income.


Depending on the total number of dependents, there will be an impact on the eligibility of the home loan. If there are quite a few numbers of dependents, it will be responsible for lowering the chances of being eligible for a home loan. Your income needs to be so high that it is capable of supporting all your dependents. Lenders are going to calculate the FOIR or Fixed-Obligation-to-Income Ratio, which is going to eliminate a certain part of the income that will be used for supporting your family members or dependents. To gain more information on this, you can visit https://www.libertylending.com/.

Kind of employment

The kind of employment is also going to impact the eligibility of home loans. Banks and traditional institutions are going to care about whether or not you are salaried, or you are a self-employed professional, or a self-employed non-professional. The eligibility criteria are going to depend on the kind of employment. If you keep changing your job frequently, it will hamper the prospect associated with receiving a home loan.

Credit as well as payment history

The payment and credit history is going to provide the lender with a clear picture of how your past liabilities have been handled and how you are going to repay your existing loans. The credit score is normally assigned based on the credit history that you have. Lenders are going to decide whether you are eligible for a home loan by going through your credit score. The credit score will inform the lender regarding the type of borrower that you are going to be. However, you do not need to be worried if the credit score is not perfect because lenders evaluate various other criteria as well to decide whether you are eligible for home loans, as stated by www.makaan.com.

Kinds of credit that are being used

If several loans are running, lenders are not going to consider you to be eligible for your home loan. The reason behind this is that several loans indicate that your appetite for incurring debt is extremely high. Other than that, if numerous unsecured loans are still running, it will be difficult to get home loans. If the find that you are not clearing the existing debts, they will not trust you and automatically you are not going to be eligible for a home loan.


Home loans can help in reducing your burden when you are thinking of purchasing a home. However, you need to find out whether you are eligible for a home loan or not. Make sure that you are following the factors that can impact your home loan eligibility before you are making a decision.

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