Unlike Home Loans, Educational Loans, or Car Loans, Personal Loans are not very cumbersome to acquire. They are unsecured, meaning there is no necessity to declare collateral or any security assets. Therefore, it really boils down to you; your monthly income and your credibility.
These days, one can get instant approvals with both banks and NBFCs (Non-Banking Financial Companies), based on a variety of reasons. But in any case, if you have an impressive set of financial prerequisites, then you'll have little to no hassles along the way.
What are they, you ask? Well, there are a number of ways you can boost your eligibility.
Increase Credit Score
This right here, it's gold. A score above 750, and the banks and NBFCs will be after you. With every loan repaid, or credit card bill settled on time, your credit score increases. There are 4 credit bureaus in India that record your score with every transaction of a similar nature. Make sure to apply with the highest score of them all.
Meticulous Payment Record
As mentioned earlier, payments made on time will result in brownie points with the credit bureaus. Make sure your dues and EMIs are regularly paid, maintaining a spotless record across. This is because Quick Personal Loan Providers look for applicants with lower risks of defaulting. Unfortunately, failure to pay your dues can negatively affect your credit score.
Make sure you present the bank/NBFC with your reason for application in an upfront manner. The more critical the scenario, the higher the loan amount they may agree upon. Wedding expenditure, medical emergencies, and home improvements usually have a higher chance.
Add Spouse's Credit Score
They don't say for better or worse for nothing. If your spouse is also a salaried employee, make sure to add their income to the application. If they too have a decent credit score, you increase your chance to get instant approvals on personal loans.
These loans are another way of confirming your credibility. Both banks & NBFCs offer loans with lower EMIs that gradually increase along with your income. These step-up loans are a great way to start working on your credit score from a young age.
Higher Take Home Pay
In most cases, this might not be under your control. But if your company is open to negotiation, ensure that your take-home salary is at least 50% or more of your gross pay. This is yet another major factor that directly impacts the loan amount.
Already paying a bigger home loan? Make sure to pick a longer tenure. This can also boost your eligibility and lower your risk of default.
With personal loans, it really comes down to your credibility. And note that your interest rates will be decided based on the same. The lower the risk of default is, the lower the interest rate.
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