Personal loans are such a kind of credit product that comes with a vast field of usage like a medical emergency, renovating homes, paying off bills or sometimes maybe for a big purchase. However, to ensure that you do not face a drawback while applying for the same, we have come up with a roadmap that you should follow to get a maximum chance to get an instant personal loan approved.
Make sure that you are aware of the loan eligibility criteria!
As a rule of hand, you should always be well informed about the loan eligibility criteria of every financial institution before applying for a personal loan. Criteria’s are mentioned below:
Apply for the right amount
Financial institutions analyze the repayment ability before approving your loan application. If you have applied for an outrageously high amount, there are chances that your loan application will be rejected. Before applying, always check if you can repay the amount comfortably in decided tenure or not. The total of EMIs from loans should not exceed 30% of the income.
Have a good Credit score
Credit score plays an essential factor in financial institutions to decide whether to approve the personal loan application or not. The calculation of credit score based on your debt to credit ratio. The score ranges from 350-900 and anything above 700 is considered as good credit score. If your credit score is good, it increases the chance of personal loan approval and helps in getting an attractive interest rate. One can always improve the credit score by
paying bills especially credit card dues on time and reducing the debt to available credit ratio.
Do not apply for a new loan, if paying the previous one
Always try there should be a gap of 6 months between two successive loans. If you already have a personal loan in your name, lenders become hesitant in providing another loan thinking that the burden of a new debt obligation and repayment will increase. Financial Institutions always see how feasible it is for you to repay their loan – this is done to mitigate risks for the Financial Institution.
Avoid multiple loan applications
Most of the time lenders check existing application status. Applying for credit from multiple sources is thus not recommended. Further, if one has multiple loan applications which are not approved, then the credit score gets negatively affected and would decrease your chances of being approved for new credit in the future. Hence, as much as possible, limit your online personal loan applications.
Show a good saving record in your bank account
It signifies that you manage your finances well and a good amount of monthly income being credited to your account every month. It will impress the lender and your chances of getting an instant personal loan will increase.
Keep your documents ready
Due to the availability of Aadhaar Card and digitalization, lenders do not need a long list of documents for processing your online personal loan. The documentation process has become a lot convenient and simple these days. Double-check your documents before submitting to avoid any delay in loan processing.
With digitized processes and instant approvals, a personal loan is one of the easiest and most convenient ways to fix your immediate financial concerns. Boost your chances of getting a loan approved by following the above- mentioned criteria.