Looking to perfect your personal loan application? Here are some ways.
When it is about a personal loan, it is necessary for the lender or bank to be aware of how you as a borrower will repay your loan. In case you have been maintaining an excellent credit history by repaying your dues by the due date, and in full, there is nothing like this. Doing so will enhance your creditworthiness as a loan borrower and enhance your chances of availing of loan approval.
Besides making timely repayments and reinforcing your creditworthiness as a borrower, there are various steps that you must take to accelerate your loan application approval process. Here is some top tried & tested ways to submit a perfect loan application. Note that you can place a loan application of any amount, may it be Rs 2 lakh loan or Rs 3 lakh personal loan. However, as most banks have an upper limit set for a personal loan, you cannot go over this limit.
Review if you mitigate the eligibility criteria
Before you place an application for a personal loan, ensure to compare the eligibility requirements of distinct lenders. Most of the banks in India have set a minimum age of 21 years and a maximum age limit of 60 years. This, however, differs from one lender to another. Additionally, banks even have distinct age requirements for the self-employed and salaried professionals.
Likewise, most banks also have set a minimum income set and a specific employment requirement. Same as age requirement, employment criteria and the income criteria even differ from lender to lender. Before you apply for a loan from a specific lender, ensure to check if you mitigate its eligibility needs for swift approval.
Keep all your documents handy.
Major documents that you will require are mentioned below:
∙ Identity proof with the photo ID like your PAN card, driving license or passport.
∙ Age proof – Documents required to prove your age are a pan card, driving license, voter ID card. You can provide any one of the documents like age proof.
∙ Address proof – Documents required to prove your address include your rental agreement, lease agreement, ration card, passport, voter ID, Aadhaar card, utility bills like electricity, water, gas, or phone bill.
∙ Income documents include current or past 3 months’ salary slips and your bank statement.
Do not skip the research
One of the greatest mistakes that you must avoid is not researching much.
Distinct banks provide a distinct rate of interest. Before you settle for a lender for a personal loan, consider all such options. In case you go for the lender nearest to your home or whom you first approached for the loan, you can miss out on attractive loan offers, which you otherwise could have availed yourself if you compared various lenders. Do not forget to have a look at the processing charges and other crucial applicable charges also. Compare all such factors before you select one of the lenders for the personal loan.
All lenders often evaluate your credit history. In case your credit score is anywhere too less, i.e., below 750 than the expected credit score or in case you have missed any of the payments, which now is mentioned on the credit report, it can prove to be a credit irresponsible individual. This may make it tough for you to avail instant approval on your loan application. Thus, it is always recommended for you to make sure that your finances are in the right order.
Do not worry! Now, you can review your credit report for free just by visiting the online financial markets. These marketplaces provide you with updated CIBIL, Experian, CRIF Highmark and Equifax credit reports, with monthly updates for free. Also, you can directly approach the respective credit bureau to avail a credit report of your choice. Note that only the first credit report would be free per credit bureau, post which if you fetch a credit report, then you will have to pay a fee.
Also, ensure to assess your credit report before you make the loan application. If there is any inaccuracy, error, or mistake, ensure to get this fixed before you place your personal loan application.
Here is a little pro tip: Always ensure to match your loan amount with your requirement. Regardless of whether you are availing loan for a long term or short term, always ensure to borrow the amount that you require. Avoid borrowing unnecessary amounts as you require repaying the principal amount along with interest. Thus, it is wise to take up just the loan that you can easily repay.
A personal loan can be advantageous if you avail it for the correct reasons. It is crucial to ensure that your lender is an extremely genuine player and that all your repayments are consistent and prompt. And most importantly, note that you use the loan for just its intended purpose. When you use a personal loan wisely, it can allow you to fill up the gap in finances without risking any of your personal assets.
Never ever apply for several loans at once, as enquiries by lenders about your score will get recorded in the form of hard inquiries in your report, and banks may picture out that you are in a financial trap. Thus, banks may consider lending you an extremely risky proposition, or the possibility of your personal loan approval may be extremely low.
Also, ensure to compute your affordability before you avail of the personal loan. You can do so by using an online personal loan EMI calculator. Such calculators are available on any lenders or aggregators’ websites. In this calculator, you must place in 3 basic details, namely your loan amount, repayment tenure and interest rate and based upon that, and the lender will compute your EMI.
Remember, if you work on the above given key areas and show yourself as a creditworthy individual with an excellent credit score, it will be tough for lenders to turn down your personal loan application.