NBFCs have a simplistic application procedure that you have to follow when applying for a personal loan. Complying with this process can help you receive approval of your loan application within 5 minutes. You can then have the loan amount in your account within a day.
However, non-compliance can lead to rejection of the application. It can also lower your CIBIL score considerably.
One of the reasons lenders often reject applications is a too high loan amount that the borrower applies for. Using personal loan eligibility can help you avoid the same.
What is a Loan Eligibility Calculator?
A loan eligibility calculator tells you the loan amount you are eligible for based on various factors.
You have to provide only the following information to check:
- Date of birth
- Monthly income
- Monthly expenses
Your monthly expenses have a significant impact on the loan amount you are entitled to. Higher amount of existing financial obligations lower your eligibility. Usually, it is advisable not to have fixed monthly debt that exceeds 50% of your income.
Foreclosing your existing loan and clearing your credit card dues lowers your debt ratio and increases your eligibility. You can check the same using a personal loan eligibility calculator.
Other Factors To Consider Before Applying
In addition to the loan amount, you have to consider the following points to ensure the lender approves your application:
You need to have a CIBIL score of 750 or more to apply for a personal loan. A high credit score is mandatory as these loans are unsecured. It is the only way a lender can understand your creditworthiness before sanctioning your loan.
Financial institutions need you to provide KYC documents (Voter ID, Driving Licence, Passport, PAN, Aadhaar, etc.) and bank account statements of the previous 3 months when you apply.
Along with the above, salaried customers have to provide their salary slips of the last 3 months and employee ID card. Self-employed customers have to produce their previous year’s turnover audited by a CA and income tax returns of the last year.
Make sure to keep all the required documents handy and use the personal loan eligibility calculator before you apply.