Allahabad Bank Home Loan Eligibility

The Allahabad Bank is a state-owned bank which was established in 1865. It is one of the oldest banks in India and is a joint-stock bank. The bank was founded in Allahabad, however, currently, the bank has its headquarters in Kolkata.

Buying your own house is a dream that many citizens hold. With the soaring house rates, it can be difficult for the common man to afford a house upfront. Home Loans provide an easy solution for this. Home Loans allow the individual to borrow the amount of money required to purchase the property while paying back the money through easy monthly instalments. Allahabad Bank provides a lot of Home Loan schemes for different needs.

Below are some eligibility criteria you will need to meet if you wish to avail a Home Loan in Allahabad Bank.

• The borrower must be an Indian National or a Non Residential Indian (NRI)
• The borrower must be either a self-employed individual or a salaried employee with regular income
• Home Loan can be availed for purposes like purchase of property or plot, construction of house, renovation or extension of an existing house, and so on.
• The borrower's age must be between 21-70 years (maximum age limit is the age by which the loan has to be repaid completely)

Below are the key features of a Home Loan in Allahabad bank.

You will have to submit the relevant documents along with your Home Loan application in order to get your loan application cleared.

1. Duly filled application form with the relevant fields.

2. Identity and residential proof:

• Aadhar Card
• PAN Card
• Voter ID Card
• International passport
• Telephone Bill
• Electricity Bill

3. Proof of income:

• 3 months of salary statement (for salaried employees).
• Business existence certificate
• 6 months of bank statement
• 3 years of profit/loss statement
• 3 years of Income Tax Returns (for self-employed individuals)

4. Other documents:

• Processing fee cheque
• 2 passport sized photographs

Note: This is not an exhaustive list of documents. Allahabad Bank can ask for documents as per their discretion.

Even if the applicant meets all the eligibility criteria mentioned above, the loan application can still be rejected based on some factors mentioned below:

• Credit score:

Banks consider credit score as one of the most important aspects before providing loan to any borrower. A credit score determines how well you have been able to handle your finances and how stable your current status is. A CIBIL score of 650 or more is generally considered to be good.

• Existing liabilities:

Before applying for a new loan, you should always ensure that you don't have existing loans. So, in case you already have existing loans, or huge debts to pay off, your loan application will be negatively impacted. If you have signed as a guarantor for a loan application, you are still held liable for that person's loan and hence, this can also impact your application. It is imperative that you make sure that you have no pending liabilities before you apply for a Home Loan.

• Credit limit usage:

You should never exhaust your entire credit limit. The utilisation of the credit limit should be done wisely to ensure that you don't appear to be credit hungry. Similarly, unpaid credit card bills will rack up as a liability issue and reduce your credit score. This will negatively impact your Allahabad Bank Home Loan application. You need to ensure that your credit card usage is moderate and in control and make sure that you clear all pending bills.

• Low remainder salary:

Even if you have considered that your salary is enough to cover the Home Loan EMI, there will be a strict emphasis on your dependencies. The number of people directly dependent on you will have an impact on your loan application as your overall disposable income goes down. You will have to ensure that you can showcase enough expendable income so that bank can have faith in your repayment capability.

• Employer not approved:

Allahabad Bank has a list of employers that are pre-approved for being safe and secure. Your chances of getting the loan disbursed are high only if your employer falls into the list. If not, there is a chance that your loan will be rejected. Generally, government-based employers are always approved.

• Issues related to property:

The property to be purchased is usually taken as mortgage against the Home Loan by Allahabad Bank. This is why the property will be thoroughly vetted by them. The bank will ask for all original documents related to the property and if they find any issues with it, the loan will likely be rejected. You need to make sure that the property does not fall under any dispute to make sure your loan application is not impacted.

• Missed instalments:

If the applicant has previously missed any instalments or any sort of payment, it will come under the bank's scanner and you will have to explain it. A missed payment has a high impact on your credit score, which lowers your chances of getting your loan disbursed. Make sure that all your finances are reviewed thoroughly through a credit report.

Even if you meet all the eligibility criteria mentioned above, the final decision of the loan disbursal rests with the bank and it is possible that even after satisfying eligibilities, your loan has still been rejected. To avoid this, you can follow the below steps to make sure your application is as concrete as possible.

• Get your finances clear:

It is very important to get a complete financial overview done for your current status. You have to map your liabilities and dependencies to make sure that you will be able to bear the burden of repayment over a long tenure. You will have to map out your actual expendable income which will be the bracket of EMI that you will be seeking. You can take either the help of a professional for this or can do it yourself.

• Credit report:

When you submit Allahabad Bank Home Loan application under your name, all of your banking and financial history is going to be checked by the bank. You need to make sure that there is nothing in your credit report that can lead to a negative impact and there are no spendings or issues that cannot be explained. You can do this by getting a credit report of your financial history done yourself and thoroughly checking it for issues.

• Apply jointly:

If you apply for a Home Loan with someone, your chances of getting your loan application accepted is much higher, especially if your co-applicant has a good credit score. The income of your co-applicant gets added to your total income and both of you become responsible for repayment. This divides the burden of repayment as well and also gives the bank some more confidence in your loan application.

• Go for a longer tenure:

The higher your loan tenure, the lower the EMI as your total amount gets divided as per the number of months as tenure. Lower EMI means lower burden every month and more confidence for the bank in your repayment capability. High tenure also means a long repayment window, which also adds to the repayment confidence. That's why high tenures can be desirable for Home Loan.