Looking for a new home loan? You may have to settle for a lower amount now

“Lenders look at obligation to income ratio, which should not go beyond a threshold. For instance, a bank would say that for those having income of Rs 40,000, the maximum EMI should not be higher than Rs 10,000, such that servicing the loan doesn’t become difficult for the borrower. As rates rise, the EMIs increase, and the loan amount reduces,” explained Arun Ramamurthy, Director of Andromeda Sales and Distribution.