PocketLoan Eligibility Calculator
Estimate the maximum loan amount banks will lend you based on your monthly income, existing loan commitments, and interest rates.
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Fixed Obligation to Income Ratio
Eligible Loan Amount
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Max Allowed Monthly EMI
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Loan Eligibility Logic
Banks evaluate loan eligibility using the Fixed Obligation to Income Ratio (FOIR). The calculation involves:
- Max Allowed EMI: (Monthly Net Income × FOIR %) - Existing EMIs
- Max Loan Amount: Eligible EMI / [ r × (1 + r)n / ( (1 + r)n - 1 ) ] where r is monthly rate and n is months.
Worked Example
If your monthly net salary is ₹60,000, you have no existing EMIs, the loan rate is 8.5% p.a., tenure is 20 years, and FOIR limit is 50%:
- Net Income: ₹60,000
- Max Allowed EMI: ₹60,000 × 50% = ₹30,000
- Interest rate (r): 8.5 / 12 / 100 = 0.007083
- Tenure (n): 240 months
- Eligible Loan Principal: ₹34,58,829
Frequently Asked Questions
What is FOIR in loan eligibility?
FOIR stands for Fixed Obligation to Income Ratio. It is the percentage of your monthly income that banks assume can be safely spent on debt EMIs (usually capped at 40-50% of net income).
How can I increase my loan eligibility?
You can increase eligibility by adding a co-applicant (spouse or family member), choosing a longer loan tenure to lower EMIs, paying off existing credit card/personal debts, or declaring additional income sources.
What is the role of CIBIL score in eligibility?
A CIBIL score doesn't change the mathematical formula of FOIR, but a high score (above 750) guarantees loan approval at lower interest rates, which mathematically increases the maximum loan principal you qualify for.
Can I get a loan if my salary is low?
Yes, but your eligible loan principal will be lower to ensure the EMI fits within the bank's FOIR limit (typically 35-40% for low-income brackets).
Does the down payment affect loan eligibility?
The bank's eligibility calculation tells you the maximum they will lend. You must make up the difference between the property/car cost and this loan amount as a down payment (margin money).