An emergency financial need can never be predicted beforehand. Not everyone will be prepared for that situation. Then how to do overcome this situation? Not to worry. Personal Loan is the best possible option to help you cope up with any kind of emergency financial situation. It is an unsecured loan, so from the bank’s perspective, it is a high-risk loan. Before approving the loan, banks and NBFCs checks your personal loan eligibility.
Personal Loan Eligibility Criteria
Personal loan is a multipurpose loan which can be used to meet almost all kinds of financial needs like- higher education, wedding, any medical emergency, electronic gadgets and much more. So, before applying for the personal loan you must check your personal loan eligibility criteria. In case you don’t match the personal loan eligibility criteria, your personal loan application will be rejected lowering the credit score.
Here are the personal loan eligibility criteria that you must satisfy-
|Type of Employment||Salaried or Self-employed individuals|
|Status of Employment||Employed for a minimum of 2 years and 1 year at least with the current employer Continue business for a minimum of 2 years and 1 year at least in the current business|
|Income||Rs. 20,000 (for metropolitan areas) Rs. 15,000 (for semi-urban & rural areas)|
|Rate of Interest||10.99% – 33% (depending on the customer’s profile)|
|Amount of loan||Up to Rs. 50 lakhs (based on the repaying ability)|
|Loan Repayment Tenure||12 to 60 months|
|Credit Score||750 or above|
Which Parameters affect Personal Loan Eligibility?
Other than the personal loan eligibility criteria, some other parameters need to be taken care of.
- Credit History – Your credit history reflecting in your credit score is a very important criterion for personal loan eligibility. Try to maintain a good credit score by paying your financial liability on time which will enhance your personal loan eligibility.
- Residential Location – The location where you reside play a major role in personal loan eligibility. If you reside in metropolitan cities, your chances to qualify for the personal loan eligibility increase compared to residing in rural or semi-urban areas.
- Rented or own house – If you stay in your own house, your possibility to qualify for the personal loan eligibility will be higher than staying in a rented house. As rented house results in lowering your repayment ability thus demoting your personal loan eligibility.
- Income – Higher the income, higher your personal loan eligibility. Higher income denotes high repaying ability.
- Organization – If you work in a reputed organization, then it is considered that you have a stable job with a better ability to repay the loan. Hence, you highly qualify for personal loan eligibility.
- Job stability – If you work for a company for a good 2 to 3 years, it shows that you are quite stable in your job. But if you frequently switch the job, then you will most likely not be trusted and you might not qualify for the personal loan eligibility.
- Any Existing Credit – If you previously have taken a personal loan, then it will lower your ability to repay which adversely affect your personal loan eligibility. Also, if you don’t pay credit card bills on time, it will also negatively affect your possibility to get a personal loan.