Are you in need of urgent cash? Or seeking for funds without pledging any collateral? Availing a personal loan can help you out! But before you apply, read on to this blog to ensure 100% approval at the lowest interest rate.
Personal loans are completely unsecured loans which can be availed to meet any of your temporary financial needs. The loan is offered by all the top lenders/banks, NBFCs and DSAs which makes it easier for the common masses to opt for it. As the loan is unsecured, lenders are stricter with their terms for approval as they want to be sure about the repayment.
Here are some of the factors which a borrower should keep in mind when applying for a personal loan to ensure approval.
Check whether you meet the eligibility criteria or not
This is the most important factor which decides your loan personal loan approval. Hence, before you apply for a Personal Loan, it’s essential to check for the eligibility criteria of different lenders. The general eligibility criteria with most of the lenders include a minimum age requirement of 21 years to a maximum of 60 years, a minimum amount as monthly income and job stability. However, the eligibility criteria vary from lender to lender.
So, if you want to ensure that your personal loan application gets approved, make sure to check if you meet its eligibility requirements for the lender.
Research well before you select one
Not researching enough for several things before you apply for a personal loan can lead to several hassles in the future and can even be the reason for your loan application rejection.
Different lenders offer the same product at different interest rates and at different processing fees. So, before you decide to go with a particular bank/lender it is quite important to research well and compare all the available options/banks. Going with the first lender that you came across for your personal loan, can keep you deprived of the better offers from other lenders.
Knowing your CIBIL Score
You might be aware of the fact that lenders check your CIBIL score before they approve your loan application. This is done to know your previous repayment history and to analyse your financial health. A CIBIL score of 750 and above leads to the approval of your loan application, while below this can lead to the rejection of your personal loan application.
So, it’s always wise to ensure that you have a good CIBIL score with all your finances in order.
You can check your Credit Score on many of the lender’s portal or you can do this with Experian, CIBIL or TransUnion.
Reviewing your credit score before applying for the loan avoids loan rejection. This is because if you find your score low you can always work on it and then apply for the loan. Doing this will surely ensure 100% loan approval.
You might ignore this, but your existing obligations and debt to income ratio play a major role in your loan application approval. Applicants with lesser obligations and low debt to income ratio get easily approved for the loan as compared to the ones who have more obligations and higher debt to income ratio.
So, in case if you have a higher debt to income ratio and want to get approved for a new personal loan then either you can wait for some of your loans to be closed or you can have a conversation with the lender and try them to convince them of the assured repayment and timely payments.
- Always apply after proper research.
- Apply only for the loan amount which is required.
- Compare different lenders before you come to any conclusion.
- Take a loan by keeping your repayment capacity in mind.
- Remember you will have to repay the borrowed amount along with the interest.
- Last but not the least, your total EMIs for all your loans should not exceed 40-50% of your gross monthly income.