You might have come across pre-approved loan offers either through call, msg or mail. Well many of us are aware of what exactly a pre-approved Personal Loan is. Whereas many still do not have full knowledge about what pre-approved personal loan is, to whom it is offered, its features, and what to do if you need such a loan. However, if you are among those who are still not aware of all these things, then this article is for you.
What is a Pre-Approved Personal Loan?
A pre-approved Personal Loan is an unsecured personal loan only but it is only offered to the individuals who have a decent Credit Score and good debt to income ratio. The loan is offered by banks and NBFCs mostly to its existing customers as they already have full information of the client. However, a pre-approved personal loan mostly comes with a limit on the loan amount, where the loan amount directly depends on your income and creditworthiness.
Eligibility Criteria
Good Credit Score
A good savings record
Decent income
Good debt to income ratio
You are likely to receive a mail, SMS or a call from your bank/lenders end if you are eligible for a pre-approved loan. In case you haven’t received any, you can check it by logging into your net banking account.
Documents Required To Avail This Loan
As the name suggests a pre-approved deal is offered to existing customers of a bank, the process is quick and hassle-free where no documentation is required. As the borrowers are already customers to the lender they have most of the documents with them. In some cases, the lender needs a few documents and the loan agreement to be signed by the borrowers. However, if you are applying for a pre-approved loan with a bank other than the one you hold an account with, then you need to provide the following documents:
- Identity proof
- Address proof
- PAN
- Aadhar card
- Bank statements for the last six months
- Salary slips for the last months
Features of Pre-Approved Personal Loan
Quick processing & fast disbursal
Since the lender has already known whether you are creditworthy or not, and have most of the documents already with them, it saves lots of time, and thus pre-approved Personal Loan gets processed quickly, probably even within minutes. And as soon as your loan is approved, the loan amount gets credited in your account in no time.
Good interest rate
Since the loan is offered by banks themselves, there are higher chances that you can get the loan at comparatively cheaper rates than others.
Flexibility
Pre-approved personal loans terms of repayment as well as uses are quite flexible. The borrower can use the funds for anything as per their requirement. Plus, they can choose for repayment tenures analysing the approximate EMI and their affordability.
Top Pre-Approved Personal Loan offering Banks:
Tata Capital
HDFC Bank
IndusInd
Bajaj Finserv
Axis bank
Things to know:
- Pre-approved offers are an invitation to apply for a loan, the invitation comes only to those who have a good credit history, income, repayment capacity, and decent debt to income ratio.
- Even though you have been offered the loan and you may also get the loan at a most competitive interest rate, still you should compare with other loans in the market before you say yes to the offer!
- It’s always important to check for the processing fees, pre-closure and pre-payment charges associated with the loan.
