Being a senior citizen it can be far from tricky to get an approval from a bank for a home loan. There is no need to lose the heart if you are already retired and looking out to buy your own home. Thankfully, many financial institutions do offer Home Loans for Senior Citizens. These home loans have been tailored specifically for pensioners or retired home buyers.
Additional Info: Also check Pan Number for Banks
As the name suggests, a Home Loan for senior citizen is available to individuals who are above 60 years of age. The product is tweaked a bit to offer required financing to senior citizens, For instance, some lenders charge a slightly higher Home Loan Interest Rate as there is an additional risk involved with lending to senior citizens. Accordingly, the repayment tenor is also reduced to match with the age expectancy of the applicants. Most banks would limit the maximum repayment tenor to the time when the applicant attains the age of 75 years. Yet, it does not mean that being a senior citizen, you cannot get the required amount at an affordable price.
With proper planning and due diligence, you can very well realise your dream of being a homeowner in or around your retirement.
Additional Info: Also check SBI Home Loan EMI Calculator
|Loan Slab||CIBIL Score||Salaried & professionals||Non Salaried & Non Professionals|
|Up to Rs 50 Lakh||600-700||8.05% -8.75%||8.15%- 8.85%|
|50 Lakhs to 1 Crore||600-700||8.25%- 8.95%||8.35%-9.05%|
|3 Crore to 15 Crore||600-700||8.40%- 9.15%||8.50%-9.25%|
*** The rate of interest for Housing Loans for Senior Citizens with lower than 600 credit score, start from 8.05% p.a for Salaried & Professionals and 8.15% p.a. for Non Salaried & Non Professionals. In case of join applicants, the applicant with higher score will be considered for ROI evaluation.
Source: As per LIC Housing Finance website.
The rate of interest and terms and conditions may vary basis the lender policies. Let’s take a look at Senior citizen home loan interest rate by other lenders below.
Additional Info: Looking for 50 Lakh Home Loan? Check EMI & Apply
Home loan interest rate for SBI starts from 8.05% p.a. and can go up to 9.05% p.a. The maximum age for loan application is 70 years and you can repay till the age of 75 years. The lowest EMI amount is Rs. 737 per Lakh. SBI home loan interest rate for senior citizens will be assessed basis loan amount, repayment capacity and lender’s credit policy. You can also use online SBI home loan calculator for senior citizens.
Bank of Baroda Home loan interest rate also starts from 7.95% and goes up to 9.30% p.a. The maximum age for loan approval is 70 years and maximum age for repayment is 78 years. The lowest EMI amount is Rs. 730 per Lakh.
PNB Housing Finance Home loan interest rate starts from 7.99% and goes up to 10.95% p.a. The maximum age to apply is 70 years and repayment is allowed till 75 years of age. The lowest EMI amount is Rs. 733 per Lakh.
BOI Home loan interest rate starts from 7.80% and goes up to 9.65% p.a. The maximum repayment age is 75 years, with the lowest EMI amount being Rs. 720 per Lakh.
The eligibility criteria vary across the lenders. Following are some of the common eligibility requirements for home loans for senior citizens in India:
1. Age: The maximum age limit capped by the banks & NBFCs is between 70 to 75 years to apply for a Home Loan.
2. Income: It is essential to establish the repayment capacity. Pensioners from public sector enterprises or banks are preferred by the lenders. For retired businessmen, establishing the stability of income is a little difficult. Ideally, the EMI amount should not be more than 60% of the take-home pension.
3. Maximum Repayment Tenor: Maximum repayment tenor available to senior citizens is 15 years. This can vary slightly across the lenders, but ideally, the lenders want the loan to be repaid by the time you get 75 years old.
4. Amount Available: The maximum amount available to senior citizens is lower than compared to younger applicants. Most banks offer up to 70% of the property value as a Home Loan to senior citizens.
5. Collateral: Senior citizens can be asked to deposit additional collateral other than the mortgaged property for securing the loan amount.
Additional Info: Also check LRD Loan.
A strict screening criterion is used to assess Home Loan applications by senior citizens. Yet, using professional advice, you can enhance the Eligibility for Home Loan. Use the following tips:
1. Add a Co-Applicant.
You can add a family member as the co-applicant for Home Loan. This will help you enhance the eligibility amount as well as extend the repayment tenor.
2. Consider pledging an additional Collateral.
High-value collaterals such as equity shares or mutual funds can be hypothecated with the lender to enhance the eligibility amount. This will reduce the risk involved for the lenders and improve the chances of the application approval.
3. Opt for lower LTV.
By depositing a higher percentage of margin money, you can reduce the LTV ratio. This will also play an important role in enhancing your eligibility for the Home Loan.
4. Close other loans.
If you have any other loans, close them before Applying for a Home Loan. Also, keep your Credit Card Utilisation Ratio below 30%.
5. Avoid multiple applications.
Filing multiple Home Loan applications simultaneously will lower your Credit Score and will reduce the chances of loan approval.
All in all, getting a senior citizen home loan is not a cakewalk. Yet, it is not impossible. You need to plan the whole process carefully and do the necessary research before applying for the Home Loan. Rushing into the process can make it difficult for you.
Additional Info: SBI Home Loan Customer Care Number
Yes, a Senior Citizen can apply for a home loan in India. The maximum age for loan application approval is 70 years with most lenders. You however, need to prove your repayment capacity and stable income source for the same.
The EMI of the home loan depends on the interest rate and tenor of the loan. Currently lowerst home loan interest rate is 7.90% and the EMI for 50 Lakh home loan for 30 years will be Rs 36,340. In case of a senior citizen, the the EMI for 50 Lakh home loan for 15 years will be Rs 47,494.
You can also avail of home loan till 70 years of age from most public sectors banks in India. LIC Housing Finance offers a dedicated home loan for pensioners.
Yes, if you have a stable income source to support EMIs and you can establish your repayment capacity, the lender will accept your home loan application.
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