A Comprehensive Guide to Obtaining a Home Loan for the Self-Employed

home loan application process for self employed

Availability of a Home Loan is a significant milestone in one’s life, marking a step towards homeownership. However, traditional home loan processes often require applicants to submit their Income Tax Returns (ITRs) as a crucial document for assessing their financial credibility.

But what if you are self-employed and did not file an ITR? Can you still secure a home loan? If you have the above questions in your mind, this article is a must-read for you.

In this article, we will explore the options available for individuals who do not file income tax returns but aspire to own a home.

Keep reading to know more about the alternative process.

Challenges Faced by Self-Employed and Non ITR Filers

Income tax returns are commonly used by financial institutions to gauge an individual’s income stability, repayment capacity, and creditworthiness. When a borrower does not file ITR, it can pose challenges in the loan approval process.

Key challenges faced by loan seekers include,

  • Income Stability Assessment: Without income tax returns, lenders struggle to gauge the stability and consistency of an individual’s earnings.
  • Repayment Capacity Uncertainty: The absence of ITRs makes it challenging for lenders to evaluate the borrower’s capacity to meet repayment obligations.
  • Creditworthiness Challenges: Non-filers may find it difficult to establish a strong credit profile, impacting their eligibility for a home loan.
  • Perceived Risk by Lenders: The lack of income tax returns may lead to a heightened perception of risk by lenders, affecting loan approval.
  • Documentation Complexity: Non-filers relying on unconventional income sources may face additional documentation requirements during the application process.
  • Stricter Approval Criteria: Financial institutions may implement stricter criteria for non-filers, such as higher down payments or interest rates.
  • Reduced Negotiation Power: Non-filers may experience limited negotiation power during the loan application process.
  • Access to Government Subsidies: The absence of income tax returns may limit access to government-backed housing schemes and subsidies.

However, there are alternative routes that can be explored.

The Step-by-Step Guide to Secure a Home Loan Without Filing an ITR

You must do the following to secure a home loan process Without Filing an ITR,

  • Declare Other Sources of Income: If you do not file an ITR due to income from unconventional sources such as rental income, freelance work, or agricultural income, it is essential to provide documentation supporting these revenue streams. Lenders may consider these alternative sources when assessing your eligibility for a home loan.
  • Joint Loan Application: Opting for a joint loan with a co-applicant who files regular ITRs can enhance your chances of loan approval. The co-applicant’s income and financial history are taken into consideration, increasing the overall eligibility for the loan.
  • Good Credit Score: A robust credit score can compensate for the absence of ITR. Maintaining a good credit history by repaying existing loans and credit card dues on time demonstrates financial responsibility, which can positively impact the lender’s perception of your creditworthiness.
  • Collateral-Based Loans: Some financial institutions offer secured loans, where the property itself serves as collateral. In such cases, lenders may be more lenient regarding ITR requirements, focusing primarily on the value and condition of the property being financed.
  • Government-Supported Schemes: Explore government-backed housing schemes and subsidies that cater to individuals with varying financial backgrounds. These schemes may have relaxed eligibility criteria, making it easier for non-filers to secure a home loan.
  • Private Lenders and Non-Banking Financial Companies (NBFCs): Unlike traditional banks, some private lenders and NBFCs may have more flexible policies regarding ITR submission. Research and approach institutions that specialize in catering to diverse financial profiles.
  • Showcase Financial Stability: Provide documentation highlighting your financial stability, such as bank statements, fixed deposits, or investment portfolios. This can serve as supplementary evidence of your ability to repay the loan.

When you haven’t filed your Income Tax Return (ITR), ensuring a smooth alternative and getting your loan process approved requires hiring an expert to handle the job for you. For instance, if you need personalized assistance, consider reaching out to the Credit Dharma team. Schedule a free demo for detailed assistance with your work.

Why Choose Credit Dharma for Expert Consultation?

With Credit Dharma, you can explore financing solutions that turn your dream of real estate ownership into a reality. Credit Dharma provides expert guidance and unbiased advice on home loan process. The team of Credit Dharma experts, with its exceptional customer service, offers guidance on improving your home loan eligibility, ensuring you qualify for the most favorable mortgage terms.

What happens when you apply for a home loan with Credit Dharma?

Credit Dharma prioritizes your home ownership dreams by offering a seamless and efficient process for applying for a Home Loan. Its comprehensive services cover everything from securing the best rates to streamlining the paperwork, ensuring a transparent and hassle-free process. 

With Credit Dharma, you can maximize your savings on home loans, achieve faster loan freedom, and enjoy a one-stop solution for all your housing finance needs.

  • Competitive Home Loan Interest Rates: You can enjoy the advantage of low-interest rates starting at 8.4% p.a., helping you reduce the overall cost of your Home Loan.
  • Swift Loan Disbursal: You get to experience faster loan disbursal, ensuring that you can move forward with your home plans without unnecessary delays.
  • Lifetime Support: You get a free lifetime support, the dedicated team is always ready to assist you at every step of your home loan journey.
  • Spam-Free Experience: Rest assured, at Credit Dharma, your privacy is valued. You’ll never have to worry about spam or unwanted communications.

You can check out Credit Dharma’s home loan eligibility calculator to determine the loan amount you are eligible for based on your income.

Here is a table summarizing the top home loan bank partners with their respective interest rates and maximum tenures:

Bank PartnerInterest Rate RangeMaximum Tenure
SBI Home LoanFrom 8.40% p.a.Up to 30 years
BOIFrom 8.45% p.a.Up to 30 years
Bajaj FinanceFrom 8.45% p.a.Up to 40 years**
Kotak Mahindra BankFrom 8.75% p.a.Up to 20 years
LIC HFLFrom 8.45% p.a.Up to 30 years
HDFC Home LoanFrom 8.45% p.a.*Up to 30 years
Axis BankFrom 9.00% p.a.Up to 30 years
ICICI Bank8.40% – 9.45%Up to 30 years
L&T FinanceFrom 8.60% p.a.Up to 25 years
PNBFrom 8.50% p.a.Up to 30 years
Note: The interest rates and maximum tenures are subject to change, and it’s advisable to check with the respective banks for the most current information.


While not filing income tax returns can pose challenges in securing a home loan. There are viable options and strategies to explore. It is crucial to be transparent about your financial situation. Explore alternative sources of income, and consider joint applications or collateral-based loans.

Additionally, maintaining a good credit score and researching government-backed schemes can significantly enhance your chances of realizing your dream of homeownership. Even if you do not file income tax returns.

Always consult with financial advisors and lenders to understand the specific requirements and options available based on your unique circumstances. If you want a personal consultation, check out Credit Dharma and schedule a demo.


What are the key factors that determine home loan eligibility?

The key factors are your income, credit score, existing debt obligations, employment stability, property type and value. Banks assess these to determine the loan amount you are eligible for.

Does employer type and work experience matter for home loan eligibility?

Yes. Having a job with reputable employer and longer work experience increases your eligibility and chances of loan approval. Self-employed individuals may still get home loans with adequate income proof.

Can joint applicants apply for a home loan?

Yes, applying with a co-applicant (like a spouse or family member) can enhance your loan eligibility as it increases the combined income considered by the lender.

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