How much home loan you can get from a bank is the question you have when you want to buy something and looking at loan options.
This article discusses the above-mentioned issue at length.
The rule of thumb that all banks follow is to multiply your net salary by 60 to reach the maximum loan amount you can get. This is common to both private and public sector banks.
Usually, banks provide home loans up to 60 times your monthly net pay or take-home pay. This varies from a case-to-case basis and your personal creditworthiness.
This is a sample monthly payslip:
Earnings —-> Amount —–>Deductions ——-> Amount
|Basic Salary 15,000||PF 1800|
|Conveyance Allowance 800||IT 1250|
|Medical Allowance 1250|
|Special Allowance 25,000|
|Net pay 50,000 (53,050 – 3050)|
LTA and MA are not considered components of take-home pay. Hence, 3500 + 1250 = 4750 is deducted from net pay (50,000 – 4750 = 45,250.) You are eligible for loan on 45,250. That would be 45,250 x 60 = 27,15,000.
There are other factors a bank would take into accounts such as loans you may have on credit cards and other loans. After deducting the monthly outgo on these, the bank will estimate your actual monthly ‘take-home’. Your actual home loan will depend on this amount.