Does a co-applicant increase eligibility?

Yes. Adding an earning co-applicant lets the lender consider combined income, which raises the EMI the file can support. Co-applicants share liability for repayment.

Is there a prepayment penalty?

On floating-rate home loans to individual borrowers, lenders in India cannot levy a prepayment or foreclosure charge. Fixed-rate loans may carry one — check the sanction letter.

How much should I keep aside beyond the down payment?

Plan for stamp duty and registration, processing fee, legal and valuation charges, and any society transfer or maintenance corpus. These are commonly several percent of the property value in total.

Home loan eligibility and documents: what lenders actually check

Loans & money · 6 min read · Reviewed January 2026

Lenders size a home loan against two ceilings: loan-to-value, typically 75%–90% of the property value depending on ticket size, and repayment capacity, usually capping EMI at roughly 40%–50% of net monthly income. Approval then depends on clean title, credit history and verifiable income documents.

The two ceilings

First, loan-to-value: the lender funds a percentage of the property's assessed value, with the rest coming from you. Stamp duty and registration usually sit outside the funded amount.

Second, repayment capacity: existing EMIs are deducted from income before the new EMI is assessed, so a car loan or a large credit-card balance reduces what you can borrow.

Documents, salaried

A typical salaried file includes:

Identity and address proof (Aadhaar, PAN, passport or voter ID)
Last three months' salary slips and six months' bank statements
Form 16 or income-tax returns for the last two years
Employment confirmation, and offer letter if recently changed jobs

Documents, self-employed

Self-employed applicants are assessed on declared, taxed income:

Income-tax returns with computation for the last two to three years
Audited financials or CA-certified accounts where applicable
Business registration proof, GST returns where registered
Twelve months of current-account statements

Property-side checks

The lender's legal and technical teams review title documents, approved plans, occupancy or completion certificate for ready property, and RERA registration for under-construction projects. A property the bank will not fund is a warning sign worth taking seriously.

Common reasons files get rejected

Thin or damaged credit history, income that cannot be documented, an unapproved or disputed property, a builder not on the lender's approved list, and applicants close to retirement age relative to the requested tenure.

Frequently asked questions

Does a co-applicant increase eligibility?: Yes. Adding an earning co-applicant lets the lender consider combined income, which raises the EMI the file can support. Co-applicants share liability for repayment.
Is there a prepayment penalty?: On floating-rate home loans to individual borrowers, lenders in India cannot levy a prepayment or foreclosure charge. Fixed-rate loans may carry one — check the sanction letter.
How much should I keep aside beyond the down payment?: Plan for stamp duty and registration, processing fee, legal and valuation charges, and any society transfer or maintenance corpus. These are commonly several percent of the property value in total.