Your dream home is something very close to your heart. Due to high and exuberant property prices you might not be able to afford a house without a loan. But you need to be doubly sure before you go ahead and apply for one. There are multiple factors that could lead to your home loan rejection. Here is a list of reasons as to why your home loan might be rejected.
- Bad CIBIL: You CIBIL score is one of the most important and crucial deciding factors for your home loan approval or rejection. If you have late payments or credit card dues, it will show up as bad CIBIL score. Also your tax returns papers must be in place for the previous years to make sure that your CIBIL score is acceptable. Make sure that you file your tax and repay all existing credit card dues before you apply for your loan.
- Being in a new job: You might be very happy with your new job and your increased pay check, but most home finance companies prefer applicants who are in a job for more than a year or even longer stint with the companies. This is vital for private company employees. If you are a constant job hopper, you are again in the same radar. Also if you have resigned from a job with no new job offer, refrain yourself from applying for a home loan during this tenure.
- Loan guarantor to a defaulter: If you are only kind enough in signing a dotted line as a loan guarantor to a loan, then you are at risk. If the person does not repay the loan, you will be responsible to repay that loan on their behalf. If you have been in this list of being a loan guarantor for a high amount, chances of your loan application being rejected shoots up.
- Your property does not satisfy guidelines: Not all properties are eligible for a loan. If the property that you are buying has problems with the titles, layout or approvals from the required authorities, then your home loan can be rejected. Generally, home loan finances prefer properties that have all approvals. Make sure that the property you are eyeing falls in line with the bank property guidelines.
- You already have other debts: If you are already juggling too many debts, then your loan application has high chances of rejection. Another reason could be not getting an NOC even after repaying your previous loan amount. Make sure that you obtain an NOC (No Objection Certificate) for all your previous closed loan amounts.