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Can a senior citizen get approval for a home loan?

By Finserv MARKETS - Dec 5,2019
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Can a senior citizen get approval for a home loan

The times are such that medical costs are rising, and inflation is high. To have an ambitious lifestyle — one which sees you in much of your comfort zone, doing things that you always wanted — you need to own a house.

While many people might differ on the opinion of owning a house, having your own home indeed gives you the luxury to do things that a rented space cannot.

While there are several options for a loan on Finserv MARKETS, it is important to understand how these loans work for people who are above 60, i.e. senior citizens.

Can a senior citizen get approval for a home loan
When Mr. Sharma retired, he wanted to put all of his savings into buying a home — something which he had always dreamt of. He could not do it when he was younger, as he never had enough money for it. However, now that he was a senior citizen, it was not very easy to get a loan, so he put his son down as a co-borrower, which let him facilitate the loan amount. With the money he had saved and the money he got from the bank as a loan, it became much more convenient for him to buy the house of his dreams.

Can senior citizens get home loan?

The simple answer to this question would be a ‘mostly no’. Senior citizens often retire by the age of 60, and at times, even before. Since they no longer have an active source of income, buying a home can be a cumbersome task, as the banks won’t be ready to give them a loan if there is no collateral.

To get a loan, they have to ensure that they do not pose any risk to the financial balance of the deal — that they can assure the bank of paying the loan back even after they have retired. Even if some senior citizens do get pension, that is not always enough to pay for the home loan, as they only receive around half of their salary as part of the pension scheme.

Adding a co-applicant to the process

One of the ways to make sure that senior citizens can get a home loan is by adding a co-applicant to the loan. Adding a co-applicant who is younger and has some sort of financial stability can increase their chances of getting the loan approved.

For the bank, it reduces the risk rate as they now have someone who can pay back the loan in all capacity. This way, they can approve the loan for older people as well, banking on the faith in the co-applicant.

For the co-applicant, it can help them with claiming tax deductions under Section 80C and Section 24 of the Income Tax Act.

Having a lower LTV ratio

Another way of having a loan approved is by paying more amount as a down payment, and less in the form of monthly instalments. If you have paid a large sum of money upfront, then it becomes easier to pay the rest of the sum in the form of fixed installments as they aren’t usually large amounts.

For banks, this can increase the bond of trust, as they can believe that most of the money has been paid upfront and that the applicant — even though he or she is retired — can pay back the money slowly.

While this process may work, it only works for those who have a large amount of savings at hand. It is always advisable that you add a younger co-applicant who has a fixed source of income.

With the above-mentioned points, it becomes easier for those who are old to apply for a loan for buying a home. If you want to apply for a home loan, then you can do so on Finserv MARKETS. On Finserv MARKETS, the good news is that senior citizens up to the age of 62 can still apply for a home loan! Apply for home loans on Finserv MARKETS is a smooth, simple and speedy process that requires minimal documentation.

The benefits of applying for a loan on Finserv MARKETS is that they come with flexible repayment — a tenure up to 300 months to pay back your loan. You also get the option to have insurance, which makes sure that your loved ones do not have to go through the rigorous process of paying back the loan in case of an unfortunate accident. Also guaranteed is 100 percent transparency — something which makes the entire process easy, efficient, and hassle-free to great extents.

Get to know tips for making down payment on home loan.

Finserv MARKETS, a subsidiary of Bajaj Finserv, is a one-stop digital marketplace that has been created for consumers on the go. It offers 500+ financial and lifestyle products, all at one place. At Finserv MARKETS, we understand that every individual is different. And that’s why we have invested in creating a proposition – Offers You Value. A value proposition that ensures you get offers which are tailor made for you. We also offer an amazing product range and unique set of online offers across Loans, Insurance, Investment, Payments and an exclusive EMI store. Be it in helping you achieve your financial life goals or offering you the latest gadgets, we strive to offer what you are looking for. From simple and fast loan application processes to seamless and hassle-free claim-settlements, from no cost EMIs to 4 hours product delivery, we work towards fulfilling all your personal and financial needs. What’s more! Now enjoy the same benefits in just one click with our Finserv MARKETS App.


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