Home Loan Eligibility 2026
Banks typically allow total EMIs to be 40-50% of your monthly income (FOIR). A rough guide:
| Monthly Salary | Max Loan (approx @ 8.75%, 20yr) |
|---|---|
| Rs.50,000 | Rs.29-35 lakh |
| Rs.1,00,000 | Rs.58-70 lakh |
| Rs.2,00,000 | Rs.1.16-1.4 crore |
Home Loan Tax Benefits FY 2026-27
Old Regime only (new regime does NOT offer these):
- Principal repayment: Up to Rs.1.5 lakh under Section 80C
- Interest on home loan: Up to Rs.2 lakh under Section 24b (self-occupied)
- For under-construction property: Interest during construction period can be claimed in 5 equal installments after possession
💡 If you have a home loan, the old tax regime is often better — the combined 80C + 24b deduction of Rs.3.5 lakh can save Rs.70,000-1,05,000 in taxes annually.
Should You Prepay Home Loan?
- If home loan rate > 9.5%: Prepay aggressively
- If rate 8-9%: Invest in equity SIP if you can get 12%+ returns
- If rate below 8%: Invest in markets, do not prepay
- RBI allows free prepayment on floating rate loans — banks cannot charge penalty
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