Many people buy home with a home loan but how much home loan can you get if your monthly salary is ₹40,000? This depends on various factors like your existing liabilities, age, loan tenure, interest rates, and the bank’s lending policies. In this blog, we will understand how banks calculate your loan eligibility and how you can maximize your loan amount.
Banks and financial institutions use something called the Fixed Obligation to Income Ratio (FOIR) to decide how much home loan you can get. This means your total fixed expenses (like current EMIs, rent, etc.) should not be more than a certain percentage of your income. Usually, banks allow you to use 40-50% of your monthly income for loan repayment.
For a ₹40,000 salary, the calculation would look like this:
If the bank allows 50% of income for EMI, then:
₹40,000 × 50% = ₹20,000 EMI eligibility
The loan amount is then calculated based on the EMI amount, interest rate, and tenure.
Let’s assume different interest rates and tenures to calculate the maximum loan amount you can get with an EMI of ₹20,000.
| Interest Rate | Approximate Loan Amount |
|---|---|
| 7% | ₹26-28 lakh |
| 8% | ₹24-26 lakh |
| 9% | ₹22-24 lakh |
| Interest Rate | Approximate Loan Amount |
|---|---|
| 7% | ₹30-32 lakh |
| 8% | ₹28-30 lakh |
| 9% | ₹26-28 lakh |
| Interest Rate | Approximate Loan Amount |
|---|---|
| 8% | ₹32-34 lakh |
| 9% | ₹30-32 lakh |
Existing Loans and Liabilities
If you have other EMIs (personal loan, car loan, credit card dues), your eligibility decreases.
Credit Score
A high CIBIL score (750+) increases your chances of getting a higher loan amount at a lower interest rate.
Job Stability and Employer Type
Government employees and employees of reputed private companies have a better chance of getting higher loans.
Age of the Applicant
Younger applicants can get longer tenures, which increases their loan eligibility.
Co-Applicant Option
Adding a co-applicant (spouse, parents) can increase your loan eligibility.
Opt for a longer tenure: A 30-year loan gives higher eligibility than a 20-year loan.
Maintain a good credit score: Pay your existing EMIs and credit card dues on time.
Reduce existing loans: If you have any existing loans, try to close them before applying.
Choose a co-applicant: This helps increase the total income considered by the bank.
Look for lower interest rates: Compare different banks and go for the lowest interest rate.
Increase your down payment: A higher down payment reduces the loan amount required, making approval easier.
If your salary is ₹40,000 per month, you can get a home loan between ₹24 lakh to ₹32 lakh depending on the bank, interest rate, and tenure. Your eligibility is influenced by factors like existing debts, credit score, age, and job stability. To maximize your loan amount, maintain a good credit score, reduce liabilities, and consider a longer tenure or a co-applicant. Always compare different banks to get the best interest rates and terms before applying for a home loan.
We understand that getting a loan can be very stressful with confusing documents, unclear communication, and various other challenges. That is why we take care of your loan application process, saving you time and hassle by handling the paperwork and communicating with the loan providers.
Check the details here at EazyBankLoan
Need help? Reach out at support@eazybankloan.com
No, generally banks approve loans up to ₹32 lakh for this salary range. A co-applicant or higher income can help increase eligibility.
Depending on the bank and interest rates, a salary of ₹55,000 to ₹65,000 per month is typically required for a ₹50 lakh loan.
Opt for a lower interest rate, increase the tenure, or make a higher down payment.
Yes, existing loans reduce your eligibility as banks consider your total liabilities before approving a loan.
Yes, government employees often get better interest rates and higher loan eligibility due to job stability.
Yes, a high credit score (750+) increases your chances of getting a higher loan with lower interest rates.
It is difficult, but possible if you show regular income through business or freelancing, maintain proper financial records, and have a good credit score.
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