A personal loan has become a basic need in today's consumerist Indian society. Easy access to personal loans has made it available for all. However, a big hurdle for personal loan aspirants is how much loan amount they will be eligible for.
Yes, multiple factors are considered to calculate your personal loan eligibility. And it is always a good practice to know the personal eligibility criteria before applying.
Factors That Affect Personal Loan Eligibility
Many factors impact your personal loan eligibility, which you must consider before applying for the same.
Age: Your age must be in the band of 21-60. This is quite logical because these are the usual years of employment in India. Please note that your age at the time of maturity of the personal loan must not exceed 60.
Type of Corporate that you work in: Applicants working in large corporates have higher chances of approval and also higher loan amount get sanctioned to them. This is because a large corporate is seen to offer more job stability as compared to a smaller one.
Net take Home: Your chances of obtaining a personal loan are the highest if you have a high net take home. Typically, applicants with net take home below 15,000/2000 rupees are not even considered for a personal loan. Net take home is defined as the amount of salary that gets credited into your salary account every month. It does not include one-timers such as incentives, bonuses etc. which are not regular in nature.
Mode of Salary: You know the minimum income required to apply for a personal loan. However, if you get salary in the form of cash, your application is likely to get rejected. Salary credits in the form of electronic credits, cheque deposits are the most acceptable modes.
Geographical Location: Your location matters when applying for quick loan approval. Because of the geographical concentration of lenders in urban areas, residents of a well-developed city have a higher chance of getting the desired personal loan than those in a village or under-developed area.
Debt Burden Ratio: The debt burden ratio is defined as the sum off all EMIs divided by a person's net take home. Lenders are likely to decline your personal loan request if you have EMIs which exceed 50-60% of your monthly net take home. In other words, having a low debt burden ratio increases your loan eligibility. You net take home in combination with your debt burden ratio are the top two important factors which determine how much your personal loan eligibility will be.
CIBIL track record: Your CIBIL score matters a lot and is the base parameter for checking your personal loan approval. Anyone with a good credit score can expect a quick loan approval. To learn more about the minimum CIBIL score for a personal loan, follow this link.
Inquiries on your CIBIL report: Now, this is something that you need to be careful about. Applying for personal loans from multiple lenders will make them consider you as 'credit hungry,' leading to a loan reject. So, make sure that you apply responsibly and don't overdo the loan applications from multiple lenders.
Bounces on the bank statement: Lenders routinely collect bank statements in order to assess your credit worthiness. If lenders notice that are several payment bounces in your bank statement, this a red flag for them which will lead to rejection of your loan application.
Now, if you want to check your personal loan eligibility, you may use the calculator in the link provided below. All you have to do is enter the below fields give below in order to check your personal loan eligibility.
Enter Your Current City: The personal loan eligibility depends upon where you live currently.
Enter Your DOB: Your date of birth matters as youngsters have a high chance of getting a personal loan than older people.
Select Your Employer: The nature of your employer plays a major role in deciding the approval process. If you can't find your current employer, select 'Other.'
Enter Your Net Monthly Income: Select your monthly income. It can include your earnings from different income streams.
Enter Your EMIs: Submit the monthly EMIs that you currently make. This will affect the personal loan eligibility.
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