Everything You Need to Know About Personal Loan Eligibility Criteria and Application
Personal loans have become quite popular these days, considering that how easy they have become to avail. There are number of lending institutions, like NBFCs, who provide personal loans at very affordable interest rates. Although, it is very important to check personal loan eligibility before applying for the advance.
Why Apply for a Personal Loan?
There can be several reasons why anyone would want to apply for a personal loan. Some of them are:
- For home renovation.
- For extravagant holiday trips.
- Profligate marriage ceremonies including destination weddings.
- To repay any existing debt, which now can’t be kept overdue.
- To purchase plots or lands.
- Sometimes, higher education can be the reason for seeking personal loans.
What are the Eligibility Requirements for Personal Loans for Salaried Workers?
You can get a personal loan for salaried workers if you meet certain criteria.
- A minimum CIBIL score of 750 is must.
- Applicant must be between the age of 20-60 years.
- Applicant must be an active employee in any private sector or any government sector.
- You Know, Applicant must be an Indian citizen.
- Applicant must earn a minimum of Rs 25,000 net income per month.
Factors that Impact Personal Loan Eligibility
- Place of residence: Your location plays an important role in determining if you are eligible for a personal loan.
- Accommodation situation: Your chances of getting your application approved will be higher if you live in your own home. This is because living in a rental property lowers your disposable income and thus lowers your repayment capacity.
- Place of work: Many a times, personal loan is granted based on the company you work for. A good company with a solid reputation will make you look like someone who is stable.
- Credit score: The most important factors that will impact your personal loan eligibility are your credit score, credit history, and credit rating. This will impact the amount, interest rate, tenure, as well as the loan amount that you are eligible for.
What are the Documents Required to be Eligible for Personal Loans?
Obtaining personal loan is quite easy. There are minimal documentation criteria. Although, depending on your lender, few documents may still be required. Like:
- Aadhaar/Voter’s card/Utility bills/passport /ration card, etc. for address proof
- Aadhaar/PAN/voter’s card for identity proof
- Bank statement of past 6 months to show active transactions records.
- Salary slips of past 3 months for salaried individuals and balance sheet for self-employed individuals.
- ITR files of up to 3 years may require in some cases.
In order to be approved for a personal loan, you will need to know how much you can borrow. The total cost for the loan is affected by the loan amount, tenure, and interest rates. To ensure that you have a stress-free loan experience, it is important to know your personal loan eligibility.
How Do You Use the Personal Loan Eligibility Calculator?
The online personal loan eligibility calculator provides an easy and useful tool to instantly estimate your personal loan amount.
- Select your location
- Enter your age. When you apply for a loan.
- If you are self-employed, select your net monthly income or yearly profit after taxes. This amount must be before any tax deductions.
- Choose your monthly EMI. This should equal the sum of all EMIs you currently pay, including those on credit cards.
- You can then select the amount of personal loans that are available to you. You can modify the tenure and interest rate to suit your needs.
Some Commonly Asked Questions About Personal Loan Eligibility:
- Do I need to pay a fee in order to verify my loan eligibility?
Many platforms that allow you to check your eligibility offer this service for free.
- Does my current debt situation affect my eligibility?
Lenders will examine how many loans you have taken before you apply for a loan. The lender will then compare that number with your monthly income. A high debt-to-income ratio could indicate that you don’t have enough income to repay another loan.
- Can I get a personal loan even though I have poor credit score?
If your credit score is not good, you may still be eligible for a loan. The lender will decide how to process your loan application.
