Imagine you’ve been running your small shop or freelance business for years, earning a good income every month, but when you arrive at the bank’s home loan office, a simple document—the ITR—stands in your way.
Are you also stuck in this dilemma? Don’t worry, today we’ll discuss this issue in detail. I’ll explain in simple terms how self-employed individuals can get a home loan without ITR.
Let’s get straight to the point—it’s not only possible, but many banks and NBFCs are making it easy.
Read to the end, because here you’ll find a step-by-step guide that will help you make your dream home a reality.
Why Do Self-Employed Face Challenges?
Millions of people in India are self-employed—shopkeepers, doctors, lawyers, traders, or small business owners.
Your income may be stable, but traditional banks consider ITR as the primary proof of income.
Why? Because it demonstrates your financial stability in their eyes.
But the truth is, many people run cash-based businesses or don’t file formal taxes, especially on a small scale.
The good news is that NBFCs like ICICI HFC are now offering flexible rules.
The lack of an ITR can be compensated for with bank statements or past loan repayment history.
This makes your credit score your strength.
My advice:
First, check your CIBIL score. If it's above 700, you can get a loan-to-value ratio of up to 80%.
Remember, getting a loan without an ITR carries a higher risk, so interest rates may be slightly higher (8.5% to 12%), but that's not worth stopping your dream of owning a home.
Eligibility Criteria for Home Loans Without ITR
Friends, the rules vary slightly from lender to lender, but generally, these criteria apply to the self-employed:
- Age: Between 23 and 70 years
- Business Experience: At least 2-3 years
- Monthly Income: More than ₹25,000
Alternative documents are useful if you don’t have an ITR.
For example, Tata Capital’s home loan eligibility calculator can easily check your eligibility – simply enter your monthly income, EMI burden, and tenure, and you’ll get the loan amount you’ll receive.
If your business is local, such as a grocery store or garment shop, PNB Housing Finance’s ‘Unnati Loan’ is a great fit.
This is especially suitable for those who don’t have formal income proof but show regular bank transactions.
Adding a co-applicant to eligibility is also helpful – your spouse or family member can be included, even if they don’t earn. This increases the loan amount.
Overall, the focus is on income stability, not just paperwork.
Required Documents: What Are the Alternatives to ITR?
Keep documentation to a minimum to keep the application process simple.
Basic Documents:
- Aadhaar card
- PAN card
- Passport-size photo
Alternatives to ITR:
- Bank statements (last 6–12 months): Show your cash flow.
- Business proof: Shop Act license, GST registration, or professional certificate (for doctors/lawyers).
- Property documents: Sale deed, no objection certificate.
- Previous loan repayment records: If you’ve ever repaid a personal loan.
Companies like Vridhi Home Finance clearly state that bank statements are sufficient if you’re self-employed. Start applying online – most lenders provide preliminary approval within 24 hours.
Tip: Scan and upload documents, and confirm any discrepancies over the phone before visiting a branch.
Top Choices: Where to Get a Loan?
There are many options available, but choose the one that matches your profile.
- Aavas Financiers: Focuses on financial inclusion – accepts alternative documents like salary slips or business certificates. Loan amount up to ₹50 lakhs, tenure up to 20 years.
- Godrej Capital: Ideal for professionals – requires 3 years of income history in addition to ITR, but joint applications are easier.
- Bajaj Finserv: Best for loan against property – LTV ratio is lower but loan amount can go up to ₹1 crore with a strong credit history.
- Aadhaar Housing Finance: Offers specialized schemes for self-employed – loans up to ₹1 crore, up to 80% of property value.
- ICICI Bank: Also covers non-professionals like traders.
When choosing, check the interest rate, processing fee (0.5–1%), and foreclosure charges. My recommendation: Compare at least 3–4 offers before finalizing.
How to Apply: Step-by-Step Guide
- Check Online: Use the eligibility tool on the lender’s website.
- Have Documents Ready: Gather the optional proofs mentioned above.
- Submit Application: Fill out the form and provide property details.
- Verification: Field visit and credit check (3–7 days).
- Disbursal: Funds transferred within 48 hours after approval.
Benefits and Precautions
Benefits:
- Faster approval
- Greater accessibility
- Tax benefits (under sections 80C and 24b)
Precautions:
- Avoid high LTV
- Keep EMIs below 50% of income
- Improve low credit score before applying
Remember, repaying the loan is your responsibility – defaulting impacts your CIBIL.
Friends, this information is for millions of self-employed people like you.
If you have any questions, ask in the comments.
Buying Your Home? Make your dream come true – apply today!