5 Smart Tips to Increase Your Home Loan Eligibility

Securing a home loan is a significant step in realising your dream of homeownership. However, the journey towards approval isn’t always straightforward, and ensuring that you meet the eligibility criteria is crucial. Here are five tips to enhance your home loan eligibility and increase your chances of getting approved for the loan you need.

Maintain a Healthy Credit Score

Your credit score is a key factor that lenders consider when evaluating your loan application. A high credit score reflects your creditworthiness and responsible financial behaviour. Aim for a credit score above 700 to increase your eligibility. Regularly check your credit report for any discrepancies and take steps to rectify them promptly. Paying bills on time and reducing outstanding debts contribute positively to your credit score.

Manage Your Debt-to-Income Ratio

Lenders assess your ability to repay a loan by examining your debt-to-income ratio (DTI). This ratio represents the percentage of your monthly income that goes toward paying debts. A lower DTI is favourable, indicating that you have sufficient income to cover your existing debts and the proposed home loan. Paying off outstanding debts or increasing your income can help improve your DTI and enhance your eligibility.

Build a Stable Employment History

Lenders prefer borrowers with a stable employment history, as it provides assurance of a consistent income. Aim to have a steady job and avoid frequent job changes during the loan application process. A reliable employment record strengthens your application and improves confidence in lenders regarding your repayment capacity.

Save for a Higher Down Payment

Saving for a higher down payment not only reduces the loan amount but also demonstrates financial discipline to lenders. A substantial down payment lowers the loan-to-value ratio, making you less risky in the eyes of lenders. Aim to save at least 20% of the property value for the down payment. Additionally, having extra savings showcases your financial stability and commitment to the investment.

Include Co-applicants or Guarantors

If your individual eligibility falls short, consider including a co-applicant with a stable income and a good credit score. Combining incomes can boost the overall eligibility. Alternatively, having a guarantor—someone willing to take responsibility for the loan in case of default—can also enhance your application’s strength. Ensure that co-applicants or guarantors understand the responsibilities and implications involved.


Increasing your home loan eligibility requires a strategic approach to financial management and planning. Maintaining a healthy credit score, managing your debt-to-income ratio, building a stable employment history, saving for a higher down payment, and considering co-applicants or guarantors are effective ways to enhance your eligibility. Remember to consult with mortgage advisors to receive tailored advice based on your unique financial situation. By implementing these tips, you not only increase your chances of loan approval but also set the foundation for a more secure and successful homeownership journey.

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