How it’s calculated
- Disposable income = net monthly income − existing EMIs and obligations.
- Maximum EMI = 60% of disposable income. Lenders usually cap total EMIs at 50–60% of income.
- Eligible loan = maximum EMI × (1 − (1 + r)−n) ÷ r, with r = rate ÷ 12 ÷ 100 and n = months.
Example: ₹1,00,000 net monthly income with ₹10,000 of existing EMIs leaves ₹90,000. 60% of that is ₹54,000, which at 8.5% over 20 years supports a loan of about ₹62,22,465.
Banks also look at your credit score, age, job stability and the property’s value, so the amount they offer can be lower.