How Much Home Loan Can You Get on a Monthly Salary of Rs. 40,000?

Owning a home is a significant milestone for many, but it often requires securing a home loan to finance the purchase. If you’re employed and wondering ‘How much home loan can i get on a monthly salary of Rs. 40,000’, you’re in luck! We are here to help and explore how much home loan you can get on a salary of Rs. 40,000 and the factors that influence your home loan eligibility, offering you practical tips in navigating the home loan application process.

Factors That Determine Home Loan Eligibility

When you submit your loan application to a loan provider, they consider the following aspects, derived from your paperwork, or determine if you are eligible for a personal loan, that is, if you can pay off in time without any defaults:

  1. Income: Your monthly salary is a crucial factor in determining your home loan eligibility. Lenders typically use a portion of your income, known as the Equated Monthly Instalment (EMI) to income ratio, to assess your repayment capacity. Generally, your EMI should not exceed 40-50% of your monthly income.
  1. Credit Score: Your credit score plays a significant role in the loan approval process. A higher credit score indicates a more reliable borrower and can lead to better loan terms and higher eligibility.
  1. Employment Stability: Lenders prefer borrowers with a stable employment history. Having a steady job and a longer tenure with your current employer can positively impact your eligibility.
  1. Age and Loan Tenure: Your age can influence the loan tenure you’re eligible for. Younger applicants may get longer loan tenures, which can increase eligibility. However, longer tenures may result in higher overall interest costs.
  2. Debt-to-income Ratio: Existing loans or financial commitments can reduce your home loan eligibility. Lenders consider your debt-to-income ratio, which is the total monthly debt payments compared to your monthly income.
Debt-to-Income Ratio (DTI)Personal Loan Approval Likelihood
Less than 20%Very High
20% – 30%High
31% – 40%Moderate
41% – 50%Low
Over 50%Very Low

Hence, if you have a salary of Rs. 40,00 and have no other active loan, your loan eligibility will be significantly higher than if you were to have multiple other loans with high EMIs.

6. Property Value: The value of the property you intend to buy also affects your eligibility. Lenders may finance a percentage of the property’s cost, known as the Loan-to-Value (LTV) ratio. You may need to make a down payment to cover the remaining cost.

Calculating Your Home Loan Eligibility

While there’s no one-size-fits-all answer to the question of how much home loan you can get with a Rs. 40,000 monthly salary, you can estimate your eligibility using the following steps:

  1. Calculate EMI Affordability: Determine how much EMI you can comfortably afford without straining your budget. As a general rule, aim for EMI payments that are within 40-50% of your monthly income.
  1. Check Your Credit Score: Request your credit report to know your credit score. A good credit score enhances your eligibility for higher loan amounts and better interest rates.
  1. Factor in Other Debts: Consider any existing loans or financial commitments that impact your monthly expenses and reduce your EMI affordability.
  1. Use an Online Eligibility Calculator: Many banks and financial institutions offer online home loan eligibility calculators. These tools can provide a rough estimate of the loan amount you might be eligible for based on your income, credit score, and other factors.
  1. Speak to Lenders: It’s advisable to consult with multiple lenders and discuss your financial situation with them. They can provide personalized insights into your home loan eligibility and offer loan options tailored to your needs.

Alternatively, you can simplify this process using a free online home loan EMI eligibility calculator.


6 Tips to Improve Home Loan Eligibility

If your home loan eligibility falls short of your desired loan amount, consider these strategies to enhance your eligibility:

#1: Increase Your Income

Look for opportunities to boost your income through a salary hike, part-time work, or freelancing gigs.

#2. Improve Your Credit Score

Work on improving your credit score by paying off outstanding debts, managing credit responsibly, and correcting any errors on your credit report.

#3. Reduce Existing Debts

Pay down existing loans or debts to lower your debt-to-income ratio and increase your EMI affordability.

#4. Extend the Loan Tenure

While longer loan tenures result in higher overall interest costs, they can increase your loan eligibility by reducing the EMI amount.

#5. Apply with a Co-Applicant

If you have a family member or spouse with a stable income, consider applying for the loan together as co-applicants to increase your combined eligibility.

#6. Higher Down Payment:

A larger down payment will reduce the loan amount you need, which can improve your eligibility. Lenders often offer better terms and interest rates to borrowers with substantial down payments. Aim for a down payment of at least 20% of the home’s purchase price, if possible.


Securing a home loan with a monthly salary of Rs. 40,000 is possible with careful financial planning and consideration of various factors. By assessing your financial situation, managing your credit, and exploring different loan options, you can take significant steps toward making your dream of homeownership a reality. It’s essential to work with lenders who can provide personalized guidance and help you find the best home loan offer that suits your needs and budget.


Frequently Asked Questions (FAQs):

Finnable has set a required minimum age for personal loan of 21 years for individuals to be eligible for a personal loan. This ensures that applicants have reached legal adulthood and are capable of entering into a financial agreement.

Yes, Finnable understands the financial needs of young borrowers and offers personalised loan options tailored to their specific requirements. Whether it's financing higher education, purchasing essential items, or starting a business venture, Finnable provides support to young individuals seeking financial assistance.

Borrowers nearing retirement may have unique financial needs, such as retirement planning, medical expenses, or supporting their children's education. Finnable offers personalised loan solutions that consider the specific circumstances of pre-retirement individuals, helping them meet their financial goals.

Unfortunately, no. Finnable does not, at the moment, offer any loans to senior citizens. Currently, 60 is the maximum age for personal loans set by Finnable

Other than personal loan age limits, Finnable considers various other factors for determining loan eligibility. These factors may include the applicant's income, credit score, repayment capacity, and employment stability. By assessing these aspects comprehensively, Finnable ensures that borrowers across different age groups can access the loan products that best suit their financial needs. 


Amit Arora

I am a seasoned retail banker with over 21 years of global experience across business, risk and digital. In my last assignment as Global Head Digital Capabilities, I drove the largest change initiative in the bank to deliver the end-to-end digital program with over US$1 billion in planned investment. Prior to that, as COO for Group Retail Products & Digital, I implemented a risk management framework for retail banking across the group.
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