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If you walk into a bank or an NBFCs and enquire about a home loan, the first question is about your employment. In case you have a decent job with a good package, then getting a home loan can be a cakewalk. However, if you are a self-employed person, a consultant or an entrepreneur, a lot of banking doors may not open. However, it is not all that tough to get a home loan as a self-employed, if you have the documentation in place.


If you are self-employed, getting a home loan need not be all that difficult. For instance, if you are a first time home buyer self-employed mortgage, then you must know the 6 key factors that will determine the eligibility of a self-employed to get a home loan. It is only after that you should get down to searching for the best bank for self-employed mortgage.

  1. Self-employed persons are classified into 2 categories. There are professionals like doctors, engineers, architects, CA, CWA, or CS; leveraging professional skills as a self-employed. Then, there are self-employed non-professional like a trader, contractor, commission agent etc. In the former case, the qualification adds value, while in the latter case you better have a good business record.
  2. For a self-employed person the revenues and profits as per the P&L account will be taken as benchmark, provided it is signed off by the auditor. In addition, to confirm the genuineness of revenues and profits, you are also required to submit 3 years of tax returns to the bank for the mortgage loan.
  3. The mortgage loan taken by a self-employed person is as much about the individual as about the business. The lender is taking a call on the individual and the business. Banks assess on age, education, dependents etc. Banks prefer people at a younger age as they have more time to repay the loan. Professional qualifications matter as banks feel reassured that if the business is not successful, then they can fall back on qualifications.
  4. Banks normally check the repayment capacity based on the debt and commitment levels of yourself and your business. This includes an assessment of existing debts such as credit card bills, personal loans, home loan, etc. Even the loans taken by the company are included in this calculation.
  5. Banks would prefer to give a loan to a self-employed professional who shows good business sense. Banks do not prefer to lend to a person whose business is not making profits, or is having shaky revenues or if the debt levels are too high. In such cases, the dividing line is quite thin between the person and the business.
  6. Banks will need to do channel checks like talking to some of you customers, vendors, and employees to be able to gauge your ability and intent.

For a self-employed person, what are the documents required? These include Proof of identity (Passport, Voter Card, Adhaar Card), Proof of residence (Passport, Voter Card, Adhaar Card, Bank Statements, Property Tax Receipts, Utility Bills), Proof of income (IT Returns, Bank Statements), Certified financials (Audited P&L Account and Balance Sheet), and Property related documents (Property Purchase agreement copy).


Look for the best home loan deal, but to get that here are some very important points you must keep in mind as a self-employed.

  • Look for innovative repayment options like Tranche based EMI, Accelerated repayment, telescopic repayment etc.
  • Banks look at net profits after depreciation. Ensure that your net profits are able to support the home loan servicing.
  • Be regular in filing tax returns and GST returns. These are important documents in actually confirming the money flows into your business.
  • Apply for a home loan when your business is doing well and growing. You are more likely to get a positive response from a bank in terms of home loan sanction.
  • Pay as much down payment as you can afford. As a self-employed, you are more likely to get approval for your home loan if your down payment is higher.
  • Did you know that it is possible to induce your salaried spouse as a co-applicant? That can improve your chances of getting the home loan and also getting higher limit.
  • As a self-employed person, you would want to repay your home loan quickly. Hence ensure there is a facility to prepay the loan with zero prepayment cost.

It is possible to get a home loan even if you are a first time home buyer self-employed mortgage seeker. There is a complete checklist you need to be aware of and you are all set to get a loan from the best bank for self-employed mortgage.

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