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07 - Income Eligibility Norms - SENP (GP Method)

Credit Norms : Based on Business Income Min of G.P & 20% of Annual TO
Illustration: Mr. Bharat a business man having a manufacturing facility in Mumbai wants to avail home
loan under G.P Method. He has a car loan with balance tenure of 28 months paying an EMI of Rs.26,572.
He wants maximum loan for tenure of 25 years @8.75% p.a.
Business Inc. Norms % Bus. Income Calculation Amt. (Rs.)
(Yearly)
Gross Profit As per P&L 100% 35,00,000 35,00,000
Annual Turnover As per P&L 20% 200,00,000 (20% x 200,00,000) 40,00,000
Min of G.P &
Income 20% of Annual TO 35,00,000 35,00,000
Considered (Turnover)
Sub-Total: Business Income per month (35,00,000/12) 2,91,667
Other Income Norms % Other Income Calculation Amt. (Rs.)

Gross As per latest Rent 100% 4,20,000 p.a (4,20,000/12) 35,000
Rental Agreement & B.S (Monthly)
Avg. of Int., Avg. of last 2 yrs. 100% Interest ( 4,46,000+5,44,000 ( 41,250
Div.& Com. as per ITR Y1=4,46,000 2 x 12
income Y2=5,44,000 (Monthly)
Sub-Total: Other Income 76,250
Other inc. is 76,250. It is
Other Income Capped at 100% of Business lower than Bus.Inc. of
considered Income 2,91,667. So income 76,250
considered is 76,250
Monthly Total Income = Business Inc. + Other Inc. (2,91,667 +76,250) 3,67,917
Loan Eligibility
Credit Norms % Income Calculation Amt.
Criteria Considered (Rs.)
Max. EMI as a %
FOIR of Total Income 80% 3,67,917 (80% x 3,67,917) 2,94,334
Less : Obligation As per P&L Or As per P&L
Interest Exp. Avg. of 6 mnths as 7,20,000 7,20,000 60,000
Paid on CC/OD per Bank Statement 12
> 12 mnths. Car Loan
Existing loan 100% 26,572 26,572
EMI O/s will be Obligation EMI of
Rs.26,572
Max. EMI to be considered = Max. EMI as per FOIR - Obligation (2,94,334-60,000-26,572) 2,07,762
2,07,762
Max. Loan Max. EMI Payable ( 822* ( x 1,00,000 2,52,75,182
possible EMI per lakh
* EMI per lakh for tenure of 25 years @ 8.75% p.a. is Rs.822

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