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Understanding The Eligibility Criteria for A Personal Loan

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Understanding the Eligibility Criteria for a Personal Loan

Personal loans are the most in-demand product in the lending sector. These loans being unsecured in nature are attracting many borrowers and the fact the loan amount can be used as per the discretion of the applicant without any interference of the lender makes them even more attractive. With the growing number of personal loan providers, the rate of interest being offered is competitive. It is easy to grab a worthy deal if one does proper research and carefully compare and study the offerings of different lenders before choosing on to the one.

Personal loans are easy to procure. They have easy eligibility criteria and require minimal documentation. But it is very important to note that the eligibility criteria as laid by the lenders are non-negotiable and the borrower must vary of checking it thoroughly before applying for the loan to avoid getting his application getting rejected. If a borrower doesn’t hold up to personal loan eligibility, chances of the personal loan not being approved are high which would significantly hamper his credit score.

Being unsecured in nature, the personal loan interest rate is usually higher in comparison to other secured loan products. These loans are offered to the eligible applicants having a steady income and repayment capacity. Some lenders offer personal loans even to applicants having a fair or poor credit score. To avail of a personal loan, one should comply with the following.

Eligibility Criteria:

Age:

The borrower must be between 21 to 60 years of age.

Nationality:

The borrower must be an Indian citizen.

Employment:

The borrower must be a salaried individual. He may be employed with a private, public or multinational company. These loans are also offered to self-employed individuals provided they have a steady inflow of income.

While every lender has a specific set of requirements and eligibility criteria but it is more or less the same and in general revolves around the factors mentioned above.

Personal loans offer the requisite financial help in the need of the hour. With online personal loans available almost instantly, it is important to choose the lender wisely, read the terms and conditions thoroughly and get hold of the additional fees and charges so as to make a well informed and calculated decision. Since lenders are strict about the eligibility criteria, it is advisable to go through it well in advance. One can check the eligibility criteria of different lenders on their digital platforms or on Fintech platforms like that of LoansJagat wherein you can compare different lenders for their eligibility criteria, personal loan interest rate, EMI, loan tenure, loan amount, processing fees and prepayment charges. Comparison helps in choosing the best lender which matches your profile.

Knowing the correct eligibility criteria makes the whole process simpler. Lenders have a personal loan eligibility calculator on their online platforms wherein the borrower can enter their details to check if they are eligible or not.

Here are a few Dos and DONTs to improve your personal loan eligibility.

Dos

  • Always check for the personal loan eligibility criteria of the lender before applying for the loan. Chances of loan application getting rejected reduce considerably if you comply with the eligibility criteria.
  • Always apply for the loan amount for which you are eligible on the basis of your financial credentials. A personal loan eligibility calculator helps you know the loan amount you are eligible for.
  • Strive to pay the monthly EMIs on time to maintain a good credit history and CIBIL score.
  • Keep your credit utilization ratio under 30% to enhance your credibility.

Don’ts

  • Avoid taking multiple loans simultaneously.
  • Don’t forget to make the loan repayments on time.
  • Avoid having a high credit utilization ratio.
  • Don’t apply for a loan with different lenders frequently.

One can avail of personal loans through banks and NBFCs. In comparison to banks, NBFCs have less stringent eligibility criteria and are more flexible in their approach. These financial institutions offer loans even to low credit score applicants. It is thus better to do prior research and choose the lender appropriately. A good lender-borrower relationship for a personal loan is based on transparency and disciplined repayments. If you are regular with the same, you can opt for a personal loan overdraft facility as well and use the money for meeting out financial emergencies.

Top 5 Reasons To Take A Personal Loan

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good reasons to take a personal loan

Thanks to constant developments in the FinTech sector, obtaining funding via a personal loan in India is now easier than ever. Gone are the days of waiting in long queues with a miscellany of files and reports to make an application. Today, you can apply from a handheld device.

Additionally, the documents required for a personal loan consist of basic KYC and financial proofs. As per a report published in Business Insider in 2019, India has over 1.9 crore personal loan borrowers. This high figure is a reiteration of the fact that owing to the ease of access, individuals are availing funding for a range of spends, both small- and big-ticket ones.

To tackle medical emergencies and complications

When faced with a medical emergency, having enough funding is key. This is because whether it is a traffic accident or a life-threatening disease that requires immediate hospitalization, most medical facilities will not provide aid without payment. Further, specialized procedures and highly-qualified doctors require finance running into lakhs of rupees. This is when offerings like the Bajaj Finserv Personal Loan come in handy. With near-instant access to a sanction of up to Rs.25 lakh, you can comfortably get the assistance that you need.

To shop without constraints both online and offline

Whether it’s buying new technology, the latest household appliances or bringing home modern furniture, shopping can be a significant expense for many. When you’re faced with unavoidable expenses, such as when you’re renovating your home, you can rely on a personal loan. With Bajaj Finserv, the personal loan eligibility criteria are simple and you obtain finance in an expedited manner. Get approval within 5 minutes and have the entire sanction disbursed to your account in 24 hours.

To host wedding celebrations and other family functions

Indian weddings are grand celebrations and depending on the customs, they last between a day and a week. In either case, the cost of hosting a well-planned wedding is high and can easily amount to a few lakhs, especially in the case of a destination wedding. However, since it is a major personal milestone, you’re unlikely to want to compromise on any aspect of the festivities, and rightfully so. This is where personal loans come into the picture. They allow you to borrow a significant amount that you can repay comfortably over a tenor of up to 60 months. 

To fund domestic or international travel

Whether you’re traveling for work or leisure, it can be a very expensive undertaking, especially if you’re headed overseas. Once you factor in costs for accommodation, food, and transport, your budget may increase significantly. Additionally, if you’re taking your family along, the amount only multiplies further. However, thanks to online provisions, you can obtain a personal loan in India within moments and so, avail financing as you chalk out your itinerary. This allows you to pay for the trip with ease and ensures that you enjoy your time away without making any compromises.

To finance higher education, both within India and overseas

With tuition fees at prestigious institutions amounting to several lakhs alone, pursuing higher education involves a high cost that can consume all your savings or your retirement fund. This is because apart from the tuition fees, you must also consider visa costs, transport and living expenses that often run into several lakhs. As a result, financing it with a personal loan for higher education can be wise. In fact, a survey shows that over 20% of personal loans taken by women were for educational expenses. Moreover, as the documents required for a personal loan aren’t many, you can obtain financing without having to produce a long list of course- or college-related paperwork.

Irrespective of the reason you want a personal loan for, remember that when you pick Bajaj Finserv, you can opt for the Flexi Loan facility. This allows you to borrow from your sanction as per your needs, multiple times. You are also charged interest only on the amount you withdraw and not the entire sanction. Another notable feature is that you can reduce your monthly installments by up to 45%.

Moreover, if an instant personal loan in India is what you need, you can check your pre-approved offer from Bajaj Finserv. Thereafter, access a personal loan on customized terms.

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Everything You Need To Know About Availing A Personal Loan Based On Salary

in Business
Availing A Personal Loan Based On Salary

Referring to a Money Tap report, a noteworthy 20.4% rise in the number of personal loans between February 2017 and February 2018 was witnessed. Besides, the CAGR (Compound Annual Growth Rate) of unsecured credits between the years 2015 and 2018 stood at 27%.

The growth in the amount of unsecured credit and the number of personal loan applications sanctioned in a fiscal year indicates that Indian customers are more inclined to apply for a personal loan on salary to meet various financial demands.

Such loans have no end-use restrictions and can be utilised by borrowers for any purpose, be it for home upgrades, purchase of appliances, meeting wedding expenses, educational expenses, etc. 

What is a personal loan against the salary?

These are unsecured credits offered by financial organisations to borrowers where they do not have to pledge any property or asset as collateral. Customers who qualify the specified eligibility criteria can avail loans easily and utilise it for their financial needs.

What are the eligibility criteria?

  • The age of the borrower should be between 23 years and 55 years.
  • The borrower should be an individual drawing monthly salary from MNC, private, or public firm. 
  • An individual has to be an Indian citizen. 
  • A CIBIL score of around or above 750 is necessary to avail of such a loan.
  • Borrowers should have a minimum salary as specified by financial companies. Normally, the minimum salary for a personal loan mandated by borrowers vary between cities as follows –

− Rs.35,000/month for Bangalore, Pune, Delhi, Mumbai, Hyderabad, Noida, Thane, etc.

− Rs. 30,000/month for Kolkata and Ahmedabad.

− Rs.28,000/month for Jaipur, Cochin, Surat, Nagpur, Chandigarh, etc.

− Personal loan on 25000 salary per month is available for residents of Lucknow, Goa, Bhubaneswar, Jodhpur, Bhopal, Mysore, etc.

What are the documents required?

Below is the list of documents that prospective borrowers need to provide in support of their personal loan on salary application so that they can quickly seek approval.

  • KYC documents like Aadhaar card, PAN card, Voter ID, etc.
  • Employee identification card.
  • Previous 2 months’ salary slip.
  • Last 3 months’ bank account statement of salary account.

How much personal loan can I get?

Financial institutions may offer a personal loan of up to Rs.25 lakh to eligible borrowers. However, the loan amount offered to an individual depends on several factors, viz. –

  • Credit score – Borrowers should maintain a healthy credit score to be eligible for such unsecured loans. CIBIL score is directly proportional to an individual’s creditworthiness.
  • Salary – The salary range is a major determinant of the loan amount a borrower can successfully avail. An individual’s income, or rather residual income after meeting the financial obligations and liable, is equal to his/her repayment capability. Higher-income is more than often considered as a determinant of higher repayment capability. Such an individual can thus pay higher EMIs and avail subsequently higher loan amounts.

Availing a personal loan on salary is now easier as individuals can apply and avail the amount disbursed to their respective savings account within 24 hours. Non-banking financial companies like Bajaj Finserv simplify loan application procedures for its customers by providing pre-approved offers on loans. Such personal loan offers are available on several financial products, including personal loans, business loans, home loans, etc. You can check out your pre-approved offer now by submitting the name and contact number. 

Subsequently, borrowers can avail loans for flexible tenors of up to 60 months and convert their loan into easy equated monthly installments. Since these are unsecured loans, borrowers don’t have much on stake, and they can repay the loan amount easily by choosing a flexible tenor. Such personal loans come in handy for individuals because of no end-use restrictions as they can utilise it for medical emergencies, wedding expenses, educational expenses, and many others. Therefore, acquire information about such terms of the loan and seek financial help as and when needed.

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