Loan Eligibility Calculator

Before approving a loan, Indian banks and NBFCs check how much EMI you can comfortably pay from your income. The most common measure is FOIR, the fixed obligation to income ratio. This calculator uses the FOIR method to estimate the largest EMI a lender may allow, and then converts that EMI into a loan amount for your chosen rate and tenure.

How to use this calculator

1. Enter your net monthly income (take-home salary, or average monthly income for the self-employed).
2. Enter the FOIR the lender applies, often 40% to 60%.
3. Enter the total of your existing EMIs, including car, personal and credit card EMIs.
4. Enter the interest rate and tenure of the new loan.
5. Read the maximum eligible EMI and the estimated maximum loan amount.

Formula

Step 1: maximum EMI for the new loan

Max EMI = Income × FOIR% − Existing EMIs

Step 2: convert that EMI into a loan amount

Loan = EMI × ((1 + r)^n − 1) / (r × (1 + r)^n)

• Income = net monthly income
• FOIR% = fixed obligation to income ratio, as a decimal (50% = 0.50)
• Existing EMIs = total monthly EMIs already being paid
• r = monthly interest rate = annual rate ÷ 12 ÷ 100
• n = tenure in months

Step 2 is the EMI formula rearranged to solve for the principal.

Worked example

Your net monthly income is ₹1,00,000, the lender applies a 50% FOIR, and you already pay a car loan EMI of ₹10,000. You want a home loan at 8.5% for 20 years.

Step 1: Max EMI = 1,00,000 × 0.50 − 10,000 = ₹40,000

Step 2:

• r = 8.5 ÷ 12 ÷ 100 = 0.0070833
• n = 240 months
• (1 + r)^240 ≈ 5.4422
• Loan = 40,000 × (5.4422 − 1) ÷ (0.0070833 × 5.4422) ≈ 40,000 × 115.23 ≈ ₹46.09 lakh

Closing a ₹10,000 EMI raises eligibility by about ₹11.5 lakh, which shows how much existing debt limits borrowing capacity.

Things to keep in mind

• FOIR varies. Lenders set FOIR by income band, employer category and loan type. Higher earners often get a higher FOIR. Some lenders count gross income, others net income.
• Credit card dues. Many lenders count around 5% of your outstanding credit card balance as a monthly obligation, even if you pay in full.
• Tenure caps. The maximum tenure is often limited by your age at loan maturity, commonly 60 years for salaried and 65–70 for self-employed borrowers.
• Loan-to-value limit. For home loans, the RBI caps lending at 90% of property value for loans up to ₹30 lakh, 80% for ₹30–75 lakh and 75% above ₹75 lakh. Your actual loan is the lower of FOIR eligibility and the LTV limit.
• Co-applicants. Adding an earning spouse or parent combines incomes and can raise eligibility substantially.
• Credit score. A strong score (commonly 750 and above) improves approval chances and may get you a lower rate, which in turn raises the eligible amount.
• Borrowing the maximum. Being eligible for a loan does not mean the EMI fits your budget. Leave room for savings, insurance and emergencies.

This calculator gives an indicative figure only. The lender's sanction letter is final.