Banks generally avoid giving home loans to senior citizens. They feel that elderly citizens do not have any solid source of income after retirement. Apart from this, they may also face health related problems and in case of any sudden untoward incident, their debt may get stuck.
However, it is not that banks always refrain from giving loans to retired and elderly citizens. If senior citizens take care of some things, they can also get a loan.
Focus on reducing risk
If you take a joint loan, it reduces the risk of the bank. In such a situation, the chances of getting the loan approved increases. If your son has a good salary, you can make him a co-applicant.
Secured loan will be approved soon
You can take loan against assets like property, gold, FD, stock or mutual fund. The loan taken against the asset is secured. In this, banks have the scope to recover their debts by selling the bank assets in case of any disturbance.
In such a situation, the loan is easily approved. If your credit score is good, things will become easier.
Keep the loan tenure short
The biggest problem for senior citizens while taking loan is age. Banks feel that in case of any untoward incident their loan will get stuck. In such a situation, you should keep the loan repayment period as short as possible. Making a higher down payment can also be an option.
Banks have a condition that their loan should be completed before 75 years of age. Meaning that if you take a loan at the age of 70, you will have only 5 years to repay it. In such a situation, the EMI burden may be higher.
You can also take loan from NBFC
If being a senior citizen, you are facing problem in getting loan from the bank, then you can also go to NBFC (Non-Banking Finance Companies). Even if your credit score is low and your age is high, NBFCs still give loans. However, they charge higher interest than banks.
