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24-Nov-2025 | Home Loan Eligibility
Buying your first home is an exhilarating milestone, but it can often feel like navigating a maze. From managing finances to understanding paperwork, the process requires meticulous planning. Following are the essentials things every first-time home buyer must know to make their homeownership journey smooth:
Your credit score is the first thing a lender will look at. A high credit score (generally 750 or above) not only increases your chances of home loan approval but also qualifies you for the best interest rates, saving you lakhs over the loan tenure. Before applying for a loan, get your free credit score check and address any discrepancies.
Don't just look at the property price; consider the total cost, including the down payment, registration charges, stamp duty, property tax, and future maintenance. A good rule of thumb is to calculate your maximum comfortable Equated Monthly Installment (EMI), ensuring it doesn't exceed 40-50% of your net monthly income.
While financial institutions typically finance a significant portion, you need to save for the down payment (usually 10% to 30% of the property value) and closing costs (like stamp duty, registration, and legal fees), which can add another 5-10% to the total price.
The location is everything. Investigate the neighbourhood's infrastructure (roads, water, power), proximity to essential amenities (schools, hospitals, workplaces), and potential for future appreciation. A well-researched location secures both your lifestyle and your investment.
Never skip a professional property inspection. This survey will uncover potential structural, electrical, or plumbing issues that could lead to costly repairs down the line. Use the inspection report to negotiate repairs or a price reduction.
Property fraud is a real concern. Vet all legal documents like the Title Deed, Sale Agreement, Building Plan Approval, and Encumbrance Certificate with a qualified legal expert. If you are buying a flat, ensure the builder has all the necessary permissions, including the Occupancy Certificate (OC).
Home insurance is often overlooked but is a vital protection for your most significant asset against unforeseen damages like fire, natural calamities, or theft.
Modern technology has made the initial planning much simpler. Take advantage of free online tools like an EMI calculator to project your monthly outgo, an eligibility checker to know your approximate loan amount, and a free credit score checker to ensure financial readiness.
Pro Tip: Aavas Financiers offers a free online eligibility checker, an EMI calculator, and a free credit score checker to empower your home-buying journey right from the start. Knowing your numbers helps you negotiate with confidence.
Use this step-by-step checklist to keep your home-buying process on track:
You should aim to save for the down payment (typically 10% to 30% of the property value) plus the closing costs (which can range from 5% to 10% of the property value) for a safe financial buffer. These upfront costs are significant and separate from your monthly EMI.
While requirements vary by lender, a credit score of 750 or higher is generally considered good. A higher score signifies lower risk and helps you secure the best interest rates. You can quickly check your score using the Aavas free credit score checker.
A fixed rate keeps your EMI constant throughout the loan tenure, offering certainty when interest rates are expected to rise. A floating rate is linked to market conditions and is usually lower initially, but your EMI can change. The choice depends on your risk appetite and market outlook.
The Eligibility Checker (like the one offered by Aavas) is a free tool that gives you an instant, approximate estimate of the maximum loan amount you can borrow based on your income, age, and existing liabilities. This calculation helps you set a realistic budget for your property hunt, saving you time and effort.
Buying a first home is a monumental financial and emotional undertaking. By adhering to these 10 essential tips and using your First-Time Home Buyer Checklist, you can approach the process with clarity and confidence. Leveraging digital tools like the Aavas free eligibility checker, EMI calculator, and credit score checker will give you a significant advantage in planning your finances efficiently. Start your journey today—your dream home is closer than you think!
Ready to calculate your dream? Would you like me to find the link to the Aavas free eligibility checker or EMI calculator for you to start your financial planning immediately?
