With various approvals, documentation, and eligibility criteria, getting a home loan is a tedious process. Procuring the same loan after retirement and for senior citizens might just seem impossible with no stable source of income and various other eligibility criteria restrictions.
Having said so, there are ways through which one can get a home loan after retirement. Banks just have additional requirements for sanctioning home loans to senior citizens. For instance, based on your age, income, and other criteria, your application will be scrutinized for a home loan after retirement. Note that, the eligibility criteria may vary from lender to lender, and also from one scheme to another.
Here are a few points that will help you get a loan approval:
– Try to take a joint loan. As a retiree, if you opt for a joint home loan with a working individual then you will be increasing the chances of the loan getting approved.
– Additionally, if you as a pensioner apply for the same loan with your children or spouse, you might also get a longer tenure along with tax benefits. Having a longer tenure will also lower your EMIs.
– Home loans after retirement usually get approved with a low loan amount. However, having a co-applicant, especially someone who has a stable income and a good credit score, reduces the credit risk for the lender, hence, the chances of approval increases along with an increased loan amount.
– One of the important catch for retired applicants is that he/she should be a pensioner with an expected stable pension income throughout the loan tenure. This increases the chances of getting the loan approved.
– The age of the borrower should also not be more than 70 years when applying for the loan. Banks and lenders usually approve loans for applicants up to the age of 70 years, and loan repayment period till 75 years. Hence, if you take a loan at the age of 70, you only get a 5 year home loan.
– Try to opt for a lower LTV (Loan to Value) ratio. If you opt for a lower LTV, it increases your chance of getting the loan approval and minimizes the EMI burden.
– Also, taking a secured loan, against assets such as another property or gold, or securities, increases the chances of getting a home loan approved. Lenders can use the assets as collaterals to make up for the unpaid amount, in case, the loan applicant is unable to repay the loan amount.
