Tools You Can Use – Home Loan Eligibility Calculator

Most financial institutions provide borrowers with a tool which is called a home loan eligibility calculator which helps in the home loan application process. This calculator takes into account the tenure and interest rate of the borrower’s choice along with their monthly total income and calculates how much loan amount the individual is eligible for. This tool must be used by all individuals who plan to apply for a home loan with a financial institution. The reasons why one must use a home loan eligibility calculator are:

* A home loan calculator helps an individual find out how much loan amount they are eligible for. This allows individuals to plan in advance and change the tenure of the loan or the interest rate charged to obtain a higher loan amount.

* Some home loan eligibility calculators take into account not just the monthly income earned by the individual but also the monthly expenses incurred. If this leads to a lower loan amount, then the individual can make changes to reduce his expenditure on a monthly basis to be eligible for a higher loan amount.

* Most financial institutions will require the home loan applicant to use the calculator after which the loan amount one is eligible for is taken into consideration along with the application.

* The home loan eligibility calculator informs an individual about how much loan amount they are currently eligible for. This knowledge is extremely beneficial as it will allow one to take steps to increase their eligibility to get the loan amount they wish for.

* This calculator also prevents the chances of a home loan applicant’s application form being rejected. The loan amount one is eligible for helps one draw up an application which provides a realistic loan amount which ensures that the application will be approved by the financial institutions.

A home loan eligibility calculator is free of cost and can be used by all home loan applicants. Financial institutions now provide this tool for all their home loan applicants to help them create a realistic home loan application which has a higher chance of being approved. There are a number of steps one can take to help improve their eligibility which includes repaying old loans, reducing the number of credit cards one owns and also planning one’s finances to reduce the monthly expenditure. One can also combine the income of another family member which will help improve their eligibility in the eyes of the financial institutions. If you are planning on applying for a home loan, before you send in your application, it is crucial to use the financial institution’s home loan eligibility calculator to check your eligibility.