Loan Eligibility Calculator

How Loan Eligibility is Estimated

Lenders generally check your monthly income, fixed obligations, credit profile, loan tenure, interest rate, age, and employer or business stability. This calculator uses FOIR to estimate how much EMI you can afford, then converts that EMI into an estimated loan amount.

FOIR means Fixed Obligation to Income Ratio. Existing loan EMIs are counted directly. Credit card dues are counted conservatively as the higher of the monthly payment entered or 5% of the outstanding amount, because lenders often treat revolving credit as a recurring repayment burden.

Formula Used

• Maximum EMI capacity = Monthly income x FOIR.
• Available EMI = Maximum EMI capacity - counted fixed obligations.
• Eligible loan amount is reverse-calculated from available EMI, interest rate, and tenure.
• Loan type presets adjust default rate, FOIR and maximum tenure, but you can still edit them.

FOIR Norms Indian Lenders Actually Use

Most Indian banks and NBFCs keep FOIR somewhere between 40% and 60%, depending on income level and loan type. Salaried applicants with lower monthly income are usually assessed at the conservative end (around 40-45%), since a larger share of a small income is needed for essential living expenses. Higher earners are often allowed 55-60%, on the assumption that a bigger income leaves more room for EMIs even at that ratio. Secured loans such as home loans typically get a more generous FOIR than unsecured loans like personal loans, because the property itself backs the lender's risk. This is why the loan type presets on this calculator default home loans to a 50% FOIR and 8.5% rate, while personal loans default to a tighter 45% FOIR and a higher 12.5% rate — unsecured lending carries more risk, so lenders both restrict how much EMI they'll allow and charge more for it.

Why Existing EMIs and Credit Cards Are Treated Differently

A running loan EMI is a fixed, predictable monthly outflow, so lenders subtract it from your FOIR capacity exactly as it stands. A credit card is different — the minimum due can look small even when the outstanding balance is large, and outstanding balances can grow quickly if only minimums are paid. To avoid understating this risk, most lenders (and this calculator) count the higher of the actual monthly payment or roughly 5% of the outstanding balance as the counted obligation. For example, a card with Rs. 2,00,000 outstanding and only Rs. 8,000 being paid monthly gets counted at Rs. 10,000 (5% of Rs. 2,00,000), not the lower Rs. 8,000 actually being paid, because 5% of the balance is the larger of the two figures.

A Worked Example

Consider a salaried applicant with Rs. 90,000 net monthly income, applying for a home loan at the default 50% FOIR and 8.5% interest rate over a 20-year tenure, with one existing car loan EMI of Rs. 12,000. Maximum EMI capacity is 50% of Rs. 90,000, which is Rs. 45,000. Subtracting the existing Rs. 12,000 EMI leaves an available EMI of Rs. 33,000. Reverse-calculating that EMI over 20 years at 8.5% gives an eligible loan amount of roughly Rs. 38.0 lakh, with total interest of about Rs. 41.2 lakh paid across the tenure. Two things change this meaningfully: dropping FOIR to a more conservative 40% (same income and EMI) cuts the eligible loan to about Rs. 27.7 lakh — a difference of over Rs. 10 lakh from that one assumption alone. Shortening the tenure to 15 years, keeping FOIR at 50%, brings eligibility down to about Rs. 33.5 lakh, since a shorter tenure means higher EMI for the same loan amount, so a fixed available EMI buys a smaller principal.

Common Mistakes When Estimating Loan Eligibility

The most common one is checking eligibility using gross income instead of net take-home income — lenders assess FOIR against what actually lands in your account after deductions, not your CTC. Another is forgetting to count a co-applicant's obligations while still counting their income, which overstates eligibility on joint applications. People also tend to enter the credit card minimum due instead of the outstanding balance, understating a card's real impact on FOIR the way lenders would see it. Finally, many applicants pick the longest available tenure purely to maximise the eligible loan amount without checking the total interest cost shown alongside it — a longer tenure raises what you're approved for, but it also raises how much of the loan is pure interest over the life of the repayment.

Loan Eligibility Calculator – Frequently Asked Questions

Is this the exact amount my bank will approve?

No. This is an estimate based on FOIR, income, obligations, rate, and tenure. Actual approval also depends on credit score, employment type and stability, existing relationship with the lender, property valuation (for secured loans), and the lender's internal policy, so the final sanctioned amount can be higher or lower than this estimate.

Why does the same income give a different eligible amount for a home loan versus a personal loan?

Home loans are secured against the property, so lenders typically allow a higher FOIR (around 50%) and charge a lower interest rate. Personal loans are unsecured, so lenders are more conservative with FOIR (around 45%) and charge a higher rate to offset the added risk, which reduces both the available EMI and the eligible loan amount for the same income.

How can I increase my loan eligibility?

Reduce existing EMIs or credit card balances before applying, add a co-applicant with a steady income, opt for a longer tenure to lower the EMI needed for the same loan amount, or improve your credit score, which can help you negotiate a lower interest rate and therefore a higher eligible amount for the same available EMI.

Does FOIR change with loan type?

Yes. FOIR limits generally vary by loan type and lender risk appetite — secured loans such as home and car loans tend to allow a higher FOIR than unsecured loans such as personal or business loans. This calculator's loan type presets reflect that typical pattern, though you can adjust FOIR manually for any loan type.