Home Loan Eligibility and FOIR: How Much Can You Borrow

A Bengaluru couple shortlisted a 90 lakh flat, confident their combined income could carry it. The bank came back with a sanction of 62 lakh, not the 72 lakh they had assumed. The gap was not a mistake. A car loan EMI, a shorter tenure driven by the elder applicant's age, and the bank's cap on how much of their income could go to EMIs had all quietly trimmed the number. They had shopped for a flat before understanding how banks decide what they can lend. Knowing that first would have saved weeks and heartache.

The short answer. Banks size your home loan using two levers: FOIR, the share of your net monthly income that can go to all EMIs combined, usually capped around 40 to 50 percent, and the RBI loan to value caps, which allow up to 90 percent of value on loans up to 30 lakh, 80 percent between 30 and 75 lakh, and 75 percent above 75 lakh. Your income, existing EMIs, tenure, age and CIBIL score all move the final figure. The trade-off to understand: a longer tenure or a co-applicant can lift your eligibility, but a longer tenure means far more total interest, and no home loan covers your down payment, stamp duty or registration, which you fund in cash.

What decides how much home loan you can get?

Your loan amount is decided mainly by how much EMI your income can support and how much of the property value the bank will finance. The first is governed by your net monthly income minus existing obligations, the second by the RBI loan to value rules. On top of these sit your age, which limits the tenure, and your credit score, which affects both approval and the rate you are offered. Put together, these decide the sanction, not the price of the flat you like.

This is why the smartest first step is to get a realistic eligibility estimate before you shortlist homes, not after. With the repo rate at 5.25 percent in 2026, home loan rates are relatively moderate, which helps eligibility a little, but the structural caps still apply. Knowing your likely sanction keeps you shopping in the right band and spares you the disappointment the Bengaluru couple faced when the number came in lower than the brochure price.

A useful move is to get a pre approval or sanction in principle from a lender before you finalise a flat. This is the bank's own estimate of what it will lend you, based on your income and credit profile, and it turns a rough guess into a number you can rely on while negotiating. It also signals to sellers that you are a serious, financeable buyer, which can help in a competitive market. Just remember a pre approval is conditional on the property clearing the bank's legal and technical checks too.

What is FOIR, and why does it cap your loan?

FOIR, the fixed obligation to income ratio, is the share of your net monthly income that goes to all your EMIs together, including the proposed home loan. Banks cap it to make sure you are not overstretched, typically allowing around 40 to 50 percent for salaried applicants and a little less for the self employed, with some relaxation for high earners. If your existing EMIs already eat into that ceiling, the room left for a new home loan EMI shrinks, and so does your eligibility.

A simple example shows the mechanics. If your net salary is 50,000 rupees and you have no other EMIs, a bank applying a 50 percent FOIR will allow a home loan EMI of about 25,000 rupees, which at prevailing rates over 20 years translates to roughly 28 to 35 lakh of loan. Clear an existing personal or car loan before you apply, and that freed up FOIR can meaningfully raise the home loan you qualify for.

How does LTV decide your down payment?

Loan to value, or LTV, is the share of the property value a bank will lend, and it directly sets your minimum down payment. Under RBI guidelines the LTV cannot exceed 90 percent on loans up to 30 lakh, 80 percent for loans between 30 and 75 lakh, and 75 percent above 75 lakh, as lender home loan eligibility guides set out. The rest is your down payment, which rises as the property gets more expensive.

The table shows how this works across price bands, so you can see the cash you must arrange before the loan even begins.

How do tenure, age and CIBIL change the number?

Tenure, age and your credit score each move your eligibility, sometimes by a lot. A longer tenure lowers the monthly EMI, which lets your income support a larger loan, but your age caps the tenure because most lenders want the loan to close by around 65. So a younger borrower can stretch to 25 or 30 years and qualify for more, while an older applicant is limited to a shorter term and a smaller sanction.

Your CIBIL score works on both approval and price. A score of 750 and above is treated as strong and usually gets you the best rates, while a weaker score can mean a higher rate or a smaller loan, and a very low score can mean rejection. Since the interest rate feeds directly into the EMI, a better score can quietly raise how much you can borrow at the same monthly outgo, which is why protecting your score before you apply is worth real effort.

How do you increase your eligibility legitimately?

You increase eligibility by improving the inputs the bank actually uses, not by inflating anything. Adding a co-applicant with a steady income, usually a spouse or parent, pools two incomes and can roughly double the loan you qualify for. Clearing existing EMIs frees up FOIR. Choosing a longer tenure lowers the EMI and lifts the eligible amount, and a clean, high credit score improves both the sanction and the rate.

Each lever has a cost to weigh. A longer tenure raises total interest paid over the life of the loan, a co-applicant shares the liability and the property, and stretching your FOIR to the ceiling leaves little cushion for life's surprises. The goal is not the biggest possible loan, but a comfortable one, so borrow to a payment you can sustain, not to the maximum a formula allows.

Clean documentation quietly helps too. Lenders assess income from salary slips, bank statements and tax returns, so a stable, well recorded income supports a higher sanction than the same income received in cash or through irregular credits. For the self employed, consistent filings over a few years matter more than a single good month. Getting your paperwork in order before you apply avoids the common outcome where eligibility is trimmed simply because the income could not be evidenced to the bank's satisfaction.

How should a Bengaluru buyer plan around eligibility?

Plan by working backwards from your eligibility to your home search, rather than forwards from a dream flat. Get a realistic estimate of your sanction, add your down payment savings, and only then set your price band, remembering that stamp duty and registration must come from cash on top. This keeps you looking at homes you can actually close, whether that is a compact flat or a home in a project such as IRA By The Banks in Attibele.

Tie the eligibility number to your monthly reality. The same EMI that a bank will sanction should still leave you room to live, so run the numbers on your own using our guide to the EMI at the current repo rate, and decide whether a fixed or floating rate suits you. A loan you can carry comfortably is worth far more than the largest one you can technically obtain.

Seven step eligibility planning checklist

1. Work out your net monthly income after tax and deductions.
2. List every existing EMI, since these reduce your FOIR room.
3. Apply a 40 to 50 percent FOIR to estimate the EMI you can support.
4. Match that EMI to a loan amount at the current rate and a sensible tenure.
5. Apply the RBI LTV cap for your price band to find the loan ceiling.
6. Add your down payment, stamp duty and registration as cash you must arrange.
7. Consider a co-applicant or clearing a loan if you need more headroom.

How much home loan can I get on my salary?

It depends on your income, existing EMIs, tenure and rate. Banks usually allow 40 to 50 percent of your net income toward all EMIs. On a 50,000 rupee net salary with no other EMIs, that supports an EMI of about 25,000 rupees, roughly 28 to 35 lakh over 20 years. A co-applicant can roughly double it.

What is FOIR in a home loan?

FOIR, the fixed obligation to income ratio, is the share of your net income going to all your EMIs, including the new one. Banks cap it, commonly around 40 to 50 percent for salaried applicants, to avoid overstretching you. High existing EMIs use up that room and reduce your eligibility, so clearing other loans first can raise it.

How much down payment do I need for a home loan?

Under RBI loan to value caps, banks lend up to 90 percent for loans up to 30 lakh, 80 percent for 30 to 75 lakh, and 75 percent above 75 lakh, so your down payment is roughly 10, 20 or 25 percent respectively. Stamp duty and registration are not financed and must be paid in cash on top.

Does my CIBIL score affect how much loan I get?

Yes. A CIBIL score of 750 and above is treated as strong and usually earns the best interest rate, while a weaker score can mean a higher rate, a smaller loan or even rejection. Because the rate feeds into your EMI, a better score can raise how much you can borrow at the same EMI, so protect it before applying.

Last updated 2026-09-07. PropNewz Team.