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CIBIL score for Axis bank home loan

Axis Bank always strives to offer the best-in-class credit products to its customers. The home loans offered by the bank are a great and affordable way of realizing ones dreams of buying property. There are multiple factors which impact home loan applications. One of the most important one being credit or CIBIL Score. In this article, we will try to decode the mystery behind this score and clarify some common doubts.

Importance of CIBIL score for getting Axis Bank home loan

CIBIL Score is one of the most important factors for home loan application requests. It contributes to almost one-third of the overall score calculation. Higher the score, better it is for loan requests. For home loan applications, a score of 750 is considered as a good score.

This three-digit score helps the lender understand how consistent and diligent a borrower has been in the past with respect to repayments and credit.

Axis Bank home loan information

Axis Bank offers various housing loan options so that everyone can fulfill the dream of having a home of their own. Some key highlights of the Axis Bank Home Loans are:

  • Competitive and attractive rates
  • Affordable and small monthly installments
  • Zero fore-closure charges
  • Options for floating and fixed rates
  • Simple and quick application process
  • Facility to transfer existing home loan to Axis Bank
  • Online loan repayment facility
  • Customized loan options such as Asha Home Loan, Empower Home Loan, Fast Forward Home Loan and Super Saver.

Interested individuals can browse the Axis Bank website to check their eligibility, figure out the monthly dues with the EMI calculator and apply online.

Probable reasons for Axis bank home loan rejection

  • Poor Credit Score: This is the first check-point for any lender to extend funds to the borrower. A bad score indicates that the borrower has defaulted in the past while repaying loans or other credit bills. Such candidates are considered high-risk (given the large quantum of home loan value). Hence, banks generally don’t process such home loan applications.
  • Instability in employment: The foremost concern for any lender is the repaying ability of the borrower. Frequent job changes or significant gaps in employment are red flags for the Bank. A stable source of income is a very important criteria for Axis Bank while considering home loan applications. Hence, such applications may get rejected.
  • Insufficient Documentation : Home loan application forms need to be submitted along with some evidentiary proof. During the application processing stage, if some documents are found to be missing, incomplete or fabricated, the loan request is turned down by the bank.
  • Inadequate income : Axis Bank conducts a thorough examination of each loan application. If the bank feels that the current income of the applicant (combined with the co-applicant, if any) is not sufficient to repay back the home loan, the application may get rejected.
  • Existing financial debts and obligations : Another important factor that may lead to loan rejection by the bank is the volume of current debts of the applicant. If the person already has multiple on-going loans and other financial obligations, then the bank is likely to not extend any more loans.
  • Property related irregularities : If the property against which the home loan is being sought is not approved by local authorities or does not confirm to the regulations, banks will not help to finance such projects. Sometimes, loan requests for old buildings (aged more than two decades) are not taken up as their resale value is not very high.
  • Age of the applicant : Home loans are for a long period. Hence, the age of the applicant is an important factor. Banks prefer younger applicants as they will have many years of employment to repay back the loan easily.
  • Co-guarantor on other loans : If the applicant acts as a guarantor on any other loan taken by family members or friends, it may impact the home loan application request. A guarantor is legally responsible to repay the loan in case of any default by the primary applicant. Hence, banks may be wary of extending a home loan to a candidate who stands as guarantor on multiple other loans.

Tips for improving CIBIL score to get Axis Bank home loan

Credit agencies look at the below mentioned factors while calculating the credit score:

  • Historical data and trends regarding payments
  • Credit usage
  • Tenure of account
  • Debt value
  • Nature of loans (secured or unsecured)
  • Type of loans taken in the past (home loans, personal loan, etc.)
  • Frequency and number of credit related enquiries made in the past

Based on these factors, here are some simple tips which can help you improve your CIBIL Score and benefit your home loan application.

  • Pay all bills on time : The most important factor which brings down the credit score is delayed or missed payments. One should ensure that all the monthly installments (loans or credit dues) are paid before the stipulated timeline.
  • Maintain your old accounts : Credit card agencies carefully scrutinize the duration with which an individual has been associated with a credit account. Hence, it is helpful to keep your older accounts active rather than jumping to new credit sources frequently. Longevity with a well-managed account helps generate a good CIBIL Score.
  • Keep a check on credit utilization limit : While one may feel that it is safe to use the credit card limit to the full, the credit agencies do not view it through the same lens. Individuals who restrict their credit utilization to 30 percent have a more favorable CIBIL Score compared to those who max out their limits. It is extremely important to be mindful of the quantum of expenses being incurred on the credit card.
  • Limit credit related enquiries : One should not make multiple credit related enquiries in a short span of time. It gives the impression that one is looking for credit from multiple sources or trying to shift the credit burden from one place to another. Such candidates are more likely to default and are tagged as high-risk, which ultimately results in a poor credit score.
  • Check for inaccuracies : Sometimes in spite of following a disciplined approach towards credit, people are shocked to see a low CIBIL Score. There could be due to administrative errors which might lead to this. Hence, it is important to check the credit bills and reports to ensure that no inaccurate or fraudulent transaction is tagged to one’s account. Any discrepancies should be highlighted to the concerned agencies at the earliest.
  • Lesser unsecured loans : Credit agencies assign a higher score to applicants who have more secured loans in their kitty. The ideal ration of secured loans to unsecured loans is 80:20. This is because in case of an unsecured loan, the security value diminishes over a period of time. In case of a default the lender will be left with a depreciated asset. Hence, one should have lesser proportion of unsecured loans in their overall debt.

FAQs On CIBIL score for Axis bank home loan

What are the Home Loan rates offered by Axis Bank?

The Axis Bank Home Loan rates are decided on the basis of MCLR announced by RBI. The current rates are:

  • Salaried individuals
  • Floating Rates
    • Loan amount below Rs. 30 Lakhs – 8.8% (MCLR + 0.15%)
    • Loan amount between Rs. 30 - 75 Lakhs – 8.95% (MCLR + 0.30%)
    • Loan amount above Rs. 30 Lakhs – 9% (MCLR + 0.35%) o Fixed Rates: 12%
  • Self-employed individuals
  • Floating Rates
    • Loan amount below Rs. 30 Lakhs – 8.85% (MCLR + 0.2%)
    • Loan amount between Rs. 30 - 75 Lakhs – 9% (MCLR + 0.35%)
    • Loan amount above Rs. 30 Lakhs – 9.05% (MCLR + 0.4%)
  • Fixed Rates: 12%

What is the eligibility criteria for getting Axis Bank home loan

In order to be eligible for a home loan, individuals should be above 21 years of age (at the time of loan application and commencement) and not more than 65 years of age (end time or maturity of loan). The additional parameters are as follows:

  • **Salaried individuals
    • Employed with a public sector or reputed private sector organization
  • **Self-employed individuals
    • Individuals who are elf-employed are eligible if they have been filing their tax returns regularly.
  • **Professionals
    • Individuals involved in professional services such as engineers, doctors, dentists, architects, chartered accountants, company secretary, and management consultants are eligible for Axis Bank Home Loan.

What if I have a low CIBIL score, will Axis Bank still give me a home loan?

Usually a credit score of 750 is recommended for home loan applications. However, CIBIL Score is not the only criteria that is considered. Home loan applications with lower CIBIL Score can also be processed if the bank is satisfied that the applicant can pay back the loan amount. Factors such as stability in income, brand name of employer, etc. can help in loan sanctions.

Does skipping Axis Bank home loan payment affect my CIBIL score?

Yes. Defaults in any loan repayment brings down the CIBIL Score.

Can I get more than 3 Axis Bank home loans if I have a good CIBIL score?

Yes. There are no legal restrictions on the number of home loans that can be given to a borrower. Multiple loans can be issued if the bank feels that the applicant has the financial capability to repay them.