A personal loan is the easiest way to get a loan. If you find yourself in a difficult situation, you may want to look into getting a personal loan online. A personal loan allows you to borrow money with less paperwork and no collateral in order to take care of unexpected costs.
Once you know the insider secrets, getting a personal loan won’t be difficult. In this article, we’ll provide 7 insider secrets tips on improving your chances of getting a personal loan.
How to increase personal loan Eligibility
Here are the 7 secrets tips to increase your personal loan eligibility:
1. Keep your credit score Excellent
If you’re applying for a personal loan, one of the most important factors will be your credit score—the probability of getting the loan increases when the applicant has a credit score of 700 or above.
However, if your credit score is poor, it is in your best time to wait until you have improved it via timely EMI and credit card bill payments and a low credit use ratio. After 60 days, you can apply again if your credit rating touches a 700 score.
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2. Get a loan that you can pay
Your chances of being approved for a personal loan might be hurt if you submit an application for a larger loan amount than you are able to afford to repay.
When choosing an amount for the loan that is manageable and reasonable for you to return, take into account all of the ways in which you get money as well as any other financial commitments you have. This will make it much easier to repay the loan, which will assist reduce the likelihood of defaults arising.
3. Reduce your ratio of debt to income
Every lending institution has a predefined debt-earnings ratio, which is the maximum amount of debt a person may easily afford to repay. To put it another way, the amount of money that you may take on as debt must exceed a particular proportion of your monthly income; otherwise, you run the risk of being labeled as a person who is “credit-hungry.”
A debt-to-income ratio that is lower than 36% is generally seen as desirable by financial experts. Therefore, before you apply for a personal loan, you should make sure that you have paid off as much of your previous debt as possible, including your credit card payments and any other obligations.
4. Reduce multiple loan applications
You could think about contacting many lenders at once in the event of a financial emergency in order to get a loan. You must, however, avoid doing this.
In addition to the possibility that lenders would see this as a credit-dependent behavior, making too many applications will lower your credit score. This is due to the fact that each loan application results in a hard inquiry on your credit report, which over time may lower your credit score.
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5. Pick your lender carefully
Pick your lender that will match your eligibility criteria like salary, credit score, etc. You should try to avoid settling for the very first lender that you come across, even though the need for loans may be very urgent.
In recent years, there have been multiple financial firms, all of whom are flooding the market with beneficial loan terms. Make sure you double-check everything to make sure you don’t miss out on any of the deals that are currently being offered.
6. Include a second borrower
The majority of financial institutions will let you apply for a personal loan while your parent or spouse acts as a co-applicant on the loan. This is particularly beneficial if you are unable to satisfy the income requirements set out by the lender or if your credit score is not enough for the position.
If they have a good monthly income and a high credit score, adding them as co-applicants to your personal loan application can increase your chances of being approved for a loan with favorable interest rates.
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7. Enquire about loan payment
The majority of the time, the lenders will let the borrowers pay for their debts. It is usually a good idea to examine whether there is an opportunity to prepay the amount of the loan, even if you decide to go with a longer repayment term.
You will be subject to certain fees if you choose to prepay a debt; however, if you do so, you will avoid having to pay the very high-interest rate that you would have been required to pay had you not done so.
Personal Loan Eligibility
You may apply for a personal loan online with little effort, but you’ll need to fulfill certain eligibility requirements before the loan amount is approved.
Check out the basic eligibility criteria before applying for a loan:
- Your age should be 23 years to 55 years
- You should have been born in India.
- You should have worked for at least 1 year.
- You have a salary slip for recent months
- Your net salary should be Rs. 12,000 or more.
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Documents Required for Personal Loan
- Pan Card
- Aadhaar Card
- Recent 3 months salary slip
- 1 years bank statement pdf format
- Electric bill or gas bill for residential proof.
- Co-applicant Aadhaar Card & Pan Card
How to Apply for a Personal Loan
Step 1: Click on the “Apply Loan” button to start the process.
Step 2: Fill in the basic details carefully.
Step 3: Fill in your residential pin code and other information.
Step 4: Upload documents like Pan Card, Aadhaar Card, 3-month Salary Slip & 1 yr bank statement.
Step 5: After the process, lenders will verify your loan eligibility and give you a better loan amount.