Loan Eligibility Calculator
Find out the maximum loan amount you are eligible for based on your income.
Maximum Loan Eligibility
EMI: ₹/month
* Based on FOIR of 50%. Actual eligibility may vary based on credit score, age, and lender policies.
What is Loan Eligibility?
Loan eligibility refers to the maximum loan amount a financial institution is willing to lend you based on your repayment capacity. Banks and NBFCs assess your eligibility by considering several factors including your monthly income, existing loan obligations, age, credit score, employment type, and the interest rate and tenure of the requested loan. Understanding your loan eligibility helps you set realistic expectations before applying for a loan.
How Banks Calculate Loan Eligibility
Banks use the concept of FOIR (Fixed Obligations to Income Ratio) to determine how much of your income is available for new loan repayments. Typically, banks allow 40-60% of your net monthly income for total EMI obligations. The formula works backwards from your available EMI capacity: Eligible Loan = Available EMI × [((1+r)n - 1) / (r × (1+r)n)], where the available EMI is your net income multiplied by the allowed FOIR percentage minus any existing EMIs.
Factors Affecting Loan Eligibility
Several factors influence how much loan you can get. Monthly Income: Higher income means higher eligibility. Existing EMIs: Current loan obligations reduce your available capacity. Interest Rate: Lower interest rates increase your eligible amount for the same EMI. Loan Tenure: Longer tenures increase eligibility as the EMI per lakh decreases. Age: Younger applicants get longer maximum tenures. Credit Score: A score above 750 typically gets better rates and higher eligibility. Employment Type: Salaried employees often get slightly higher eligibility than self-employed individuals.
Using the Loan Eligibility Calculator
Enter your monthly income, any existing EMIs you currently pay, the expected interest rate, and your desired loan tenure. Our calculator instantly shows the maximum loan amount you are eligible for, along with the corresponding EMI. The calculation assumes a FOIR of 50%, which is the industry standard. You can adjust inputs to see how increasing your income or extending the tenure affects your eligibility.
Tips to Improve Loan Eligibility
To improve your loan eligibility, consider paying off existing loans and credit card dues before applying. A higher credit score (above 750) can help you get better terms. Adding a co-applicant's income can significantly increase the eligible amount. Opting for a longer tenure reduces the EMI burden and increases eligibility. Maintaining stable employment and avoiding frequent job changes also strengthens your application.
Frequently Asked Questions
Banks typically allow 40-60% of your net monthly income for total EMI obligations, known as FOIR (Fixed Obligations to Income Ratio). For home loans, this can go up to 60-65% for higher income brackets. Our calculator uses a standard 50% FOIR, which is the most common benchmark used by lenders.
Yes, your credit score significantly impacts loan eligibility. A CIBIL score above 750 typically results in better interest rates and higher loan amounts. A score between 650-750 may still get you approved but at higher rates. Below 650, most banks may reject the application or offer very limited amounts.
Yes, there are several ways: add a co-applicant (spouse or parent) to combine incomes, pay off existing loans and credit card dues, opt for a longer tenure, improve your credit score, or show additional income sources. Some banks also consider rental income, bonuses, and variable pay for eligibility calculation.
Typically, you need salary slips (last 3 months), bank statements (last 6 months), Form 16/ITR (last 2 years), PAN card, Aadhaar card, and property documents (for home loans). Self-employed individuals need ITR for 3 years, business financial statements, and GST returns.