FOIR in Home Loan Calculation: – Have you ever applied to a bank for a home loan, and after looking at your salary, the bank says they can only grant you this much home loan? And sometimes, the loan is even rejected?
Why does this happen? On what basis does the bank decide how much loan you should or should not get?
This is where FOIR (Fixed Obligation to Income Ratio) changes your entire loan story.
Many people think, “If I have a good salary, the bank will definitely give me a loan.”
But the bank looks not just at your salary, but also at the ratio of your EMI and other expenses.
And this ratio is called FOIR.
FOIR Meaning in Hindi – FOIR का मतलब क्या है?
FOIR (Fixed Obligation to Income Ratio) का मतलब है —
आपकी कुल मासिक सैलरी में से कितनी रकम पहले से किसी EMI, लोन या क्रेडिट कार्ड बिल में जा रही है।
बैंक इस Ratio को देखकर यह तय करता है कि आपके पास नए लोन की EMI चुकाने के लिए कितना पैसा बचता है।
यानी FOIR बताता है कि आपकी लोन चुकाने की क्षमता कितनी मजबूत है।
Understand the meaning of FOIR with an example.
Let’s say your monthly salary is ₹60,000.
And you’re already paying an EMI of ₹15,000 every month (car loan + credit card, etc.).
Now the bank calculates your FOIR like this:
FOIR = (Existing EMI ÷ Monthly Income) × 100
➡️ That is, (₹15,000 ÷ ₹60,000) × 100 = 25% FOIR.
This means that 25% of your salary is already going towards EMIs.
If the bank’s acceptable FOIR limit is 50%, then
the bank can use your remaining income to fund a new home loan with an EMI of up to ₹15,000.
How to Calculate FOIR for Home Loan Manually
If you want to know your FOIR from the comfort of your home, follow the manual formula below.
FOIR Formula: –
FOIR = (Total EMI Due / Monthly Net Income) × 100
Step-by-Step Calculation Example:
Enter your Monthly Net Income → ₹70,000
Add all your existing EMIs → ₹20,000
Now apply the formula:
(₹20,000 ÷ ₹70,000) × 100 = 28.57% FOIR
Now, if the bank’s FOIR limit is 50%, this means that
you still You can easily afford a new Home Loan EMI of ₹15,000–₹20,000.
FOIR Limit for Home Loan – How much FOIR does the bank accept?
Each bank has its own FOIR limit, but generally:
FOIR Limit for Salaried Applicants → 40% to 60%
FOIR Limit for Self-Employed Applicants → 60% to 75%
🔹 If your salary is high, the bank may accept a slightly higher FOIR.
🔹 However, if your salary is low or not stable, the bank may maintain a conservative FOIR.
Why is a loan rejected if the FOIR is high?
Banks believe that if a significant portion of a person’s income is already going towards EMIs, then granting a new loan is risky because the risk of EMI default increases.
👉 For example –
If your salary is ₹60,000 and you are already paying an EMI of ₹40,000,
then FOIR = (40,000 ÷ 60,000) × 100 = 66%
In this situation, the bank will assume that you don’t have enough savings for the new EMI,
and will either reject your home loan or offer a lower loan amount.
How to Reduce High FOIR for Loan Approval
If your FOIR is high and your loan is repeatedly getting rejected, the following tips can be a game-changer.
Prepay Existing EMIs:
If you have some extra savings, pay off smaller loans (like personal loans or credit card bills) first.
This will reduce your FOIR.
Take a Joint Loan:
Make your spouse or family member a co-applicant.
This will increase your household income and lower your FOIR Ratio.
Strengthen Income Proof:
Document bonuses, side income, or business income so the bank recognizes your total income.
Control Your Credit Card Limit:
Using too many cards or meeting minimum payments impacts both FOIR and your credit score.
Conclusion
Your FOIR isn’t just a ratio, it’s a pathway to your dream home.
If you understand it and keep it under control—
then no bank can stop your home loan.
Check your FOIR Now: – homeloanfoir.com
👉 Remember:
“Smart loan management is more important than a good income.”
So calculate your FOIR today, improve your EMI, and hold the keys to your dream home.
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