A personal loan is a useful credit product that can help you can achieve your financial goals without you having to liquidate your savings. Since a personal loan is usually an unsecured loan, the risk factor associated with it is considerably low. Also, with leading financial institutions, personal loans can be availed instantly through a hassle-free online application process. This makes personal loans a preferred option amongst many individuals for raising instant funds.
It is to be noted that while availing a personal loan, you must compare various factors such as the interest rate, loan amount, loan tenure, prepayment clauses, etc. This will help you avoid any inconvenience in the later stages. Additionally, before applying for a personal loan with a financial institution, you must go through the personal loan eligibility criteria set by that particular lender. This will reduce the rejection chances of your personal loan application. Since repeated loan applications can harm your credit score significantly, it becomes important to understand the eligibility criteria set by the lending institutions beforehand. The eligibility criteria might differ from one financial institution to another. If the applicant satisfies the eligibility criteria, they can apply for a personal loan by filling an online application form and uploading all the required documents.
Let us have a look at some of the factors that financial institutions check before approving a personal loan application.
The common guideline followed by most of the lenders is that for availing a personal loan a salaried individual must between the ages of 21 to 60 years. In case of self-employed individuals, the age limit is between 25 to 65 years.
Financial institutions check your source of income before approving your personal loan. Therefore, it is important that you have a stable job and a steady source of income. If you have a history of quitting jobs frequently, then there are high chances of your personal loan being rejected.
All financial institutions have minimum income criteria. In order to be eligible for a personal loan, your annual income should satisfy the criteria set by your loan-provider. If you fail to meet the annual income criteria set by the lender, your personal loan application is likely to get rejected.
Your credit score reflects your creditworthiness. While availing a personal loan, having a high credit score can be of great help. A good credit report improves the chances of your loan approval. Moreover, it can also help you obtain a high loan amount at a comparatively lower interest rate. In order to assess your financial condition, lending institutions might have a look at your monthly income and the stability of your job.
In order to enhance the approval chances of your personal loan application, you should look for a financial institution that has minimum eligibility criteria. You can also make use an eligibility calculator to check loan eligibility online using a personal loan eligibility calculator and apply for a loan that suits your needs.
Let us understand the basic Personal loan eligibility:
- You must be an Indian citizen
- You must be a salaried individual between the ages of 23 – 58 years
- The minimum take-home salary for tier 1 city is INR 37,000 whereas for Tier-II cities, the same is INR 27,000.
Let us have a look at some of the other advantages of availing a Personal Loan Online
You can avail the required loan amount within 24 hours. This makes Personal Loans one of the best tools to fight financial emergencies.
The entire process of availing a personal loan is online. Therefore, you can apply online for an instant loan, send the documents online and can e-sign the loan agreement. The exclusion of physical documentation has made the process of availing Personal Loan efficient and hassle-free.
The repayment of personal loan is done in EMIs, which is the easiest way to repay any kind of loan. The auto EMI deduction if the loan makes the repayment very convenient.
Personal Loans are collateral-free loans. Therefore, you are not required to pledge any collateral while availing this loan. So it keeps you free from the risk of losing your asset in case of non-payment of the loan.
Online loan management
You can easily manage your personal loan details online with the help of a customer-friendly portal.
Documents required to avail a personal loan
Minimal documentation is yet another advantage of availing personal loans with leading financial institutions.
- Your Aadhar Card/Passport/Driving License.
- Your PAN Card.
- Bank Statement of the last 3 months.
- Moreover, you can check your eligibility online by visiting the eligibility calculator.
Since interest rates charged on personal loans play a crucial role in defining the overall cost-of-borrowing, it is recommended to settle for a financial institution that offers personal loans at the most competitive interest rates. Now that you are well aware of the eligibility criteria and various aspects to consider while availing a personal loan, ensure that you make the right choice for yourself. Lastly, while availing a personal loan, do not forget to read the terms and conditions of the loan agreement carefully before signing it.