Is a Down Payment Mandatory for a Home Loan in India?

Purchasing a home is a long-term commitment. While most buyers rely on a Home Loan to fund the purchase, one must still contribute a portion of the total property cost as a down payment. If you are planning to buy a home, you might be wondering how much down payment is required for a Home Loan.  

In this article, we will discuss the minimum down payment for a Home Loan, factors affecting the amount, and how you can plan for it effectively. 

What is a Home Loan Down Payment?

A down payment is the amount that a borrower must pay upfront towards the purchase of a house. It is not covered by the Home Loan and is borne by the borrower.  

How Much Down Payment for a Home Loan in India?

In India, the down payment amount for a Home Loan varies based on the value of the property: 

• For property values up to Rs.30 Lakh, the maximum LTV allowed is 90%.  
• For property values between Rs.30 Lakh and Rs.75 Lakh, the maximum LTV is 80%.  
• For property values above Rs.75 Lakh, the maximum LTV is 75%. 

How to Prepare for a Home Loan Down Payment?

Here are a few practical steps to help you plan: 

• Start saving early to build your down payment fund. 
• You can use fixed deposits, recurring deposits, or mutual funds to grow your savings. 
• Utilise bonuses towards your down payment.  

Benefits of a Lower Down Payment

Many borrowers prefer to make a smaller down payment due to the following benefits: 

• It is more cost-effective in the short term. 
• You can avoid liquidating investments. 
• You have more liquidity for other expenses or investments. 

However, it is important to note that opting for a lower down payment increases your Home Loan amount. This can lead to a higher interest outgo over time.  

Benefits of a Higher Down Payment

You can consider making a higher down payment as per your financial profile. Some of the key advantages of making a higher down payment include: 

• A smaller loan amount reduces your total debt obligation. 
• It can improve your Home Loan eligibility and enable you to negotiate for a lower interest rate. 
• You can enjoy manageable EMIs and easy repayment. 

Eligibility Criteria for a Home Loan

To apply for a Home Loan with Bajaj Housing Finance, you need to meet the following eligibility requirements: 

For Salaried Applicants:

• Must be an Indian citizen (including NRIs) 
• Age between 23 and 67 years** 
• Must have at least 3 years of work experience 

For Self-Employed Applicants:

• Must be a resident Indian 
• Age between 23 and 70 years** 
• Must have a minimum of 3 years of business continuity 

**The upper age limit is considered as age at the time of loan maturity. Additionally, the upper age limit for applicants is subject to change, depending on the property profile. 

Documents Required to Apply for a Home Loan

Keep the following documents*** ready to apply for a Home Loan:  

Salaried Individuals:

• PAN Card or Form 60 (mandatory) 
• Aadhaar or Voter ID 
• Salary slips for last 3 months 
• Property documents 

Self-Employed Individuals:

• PAN Card or Form 60 (mandatory) 
• Aadhaar or Voter ID 
• Latest ITR and P&L statements 
• Property documents 

***This list is indicative. Lenders may request additional documents. 

Steps to Apply for a Home Loan

Applying for a Home Loan with Bajaj Housing Finance is simple: 

1. Visit our Home Loan application form. 
2. Fill in personal and financial details. 
3. Enter the OTP and verify your mobile number. 
4. Enter the PIN code and the required loan amount.  
5. Submit the form. 

Our representatives will connect with you in 24 hours* and take you through the next steps.  

Understanding how much down payment is required for a Home Loan can simplify your home-buying journey. Planning ahead helps you reduce your obligations and secure better loan terms.