Loan Against Property eligibility depends upon various factors. A few of them are listed below:
Your income determines the amount of loan you are eligible for. Banks generally keep an EMI to Income ratio at 50% to 60%.
A stable business is preferred, meaning there should be signs of growth for the last 3 years. Sustained revenues and billing along with profit, act as cherry on top for loan applicants. If your total business experience exceeds 5 years along with good results in the stipulated tenure then that makes you a good business loan applicant.
For Business owners, income shown in Annual Income tax returns is usually considered. There are other income eligibility calculation methods also like Gross Turnover, Banking Surrogate, Existing EMI track record, GST method and so on.
In case you are paying EMIs on existing loans, then the Business Loans eligibility amount will come down to keep the EMI to income ratio at 50% to 60%.
Banks also check credit history of a borrower from CIBIL which stands for Credit Information Bureau India Ltd. It is a repository of information, which contains the credit history of commercial and consumer borrowers. CIBIL provides this information to its members in the form of credit information reports. Individuals can also access their own credit reports from CIBIL. For more information refer www.cibil.com
Generally a Credit Score of 700 & above is considered GOOD. Many Banks these days are following , which means - Better your CIBIL Score, Better Interest Rate you will get!