Personal loan is one of the most popular ways to get additional funds in need. Also called a lifestyle loan, this is a multipurpose loan which can be used to buy equipment, real estate, repay loans, cover travel expenses etc. Personal loans come with flexible repayment terms as well. The loan amount is also flexible and is available to all resident Indians who fulfill the loan criteria.
The only challenge is the stringent personal loan application validation process. Let us checkout 6 ways to ensure that the loan application is not rejected.
Clear existing dues
No bank will provide another loan to an applicant who is already under the burden of multiple loans. So, if you are looking for a personal loan, clear the credit card outstanding and pay off existing loans (if any).
Get a good credit score
Credit score is the numeric ranking of a borrower and is indicative of the individual’s credit worthiness. An individual who makes regular EMI and credit card payments will have a better credit score than a regular defaulter. Banks prefer giving loans to applicants with outstanding credit ratings; a credit rating above 700 is termed as outstanding. So, revise credit report and make the required amendments before applying for a personal loan.
Decide on the loan amount
It is always advisable to take loan only for the required amount. There is no point asking for an exorbitant amount if not required. Along with credit history, lenders also check the monthly income of the applicants. In case the expected loan amount is not in proportion with the monthly salary, the personal loan application validation result will be negative.
Have a steady income
Lenders dig into the financial profile of the loan applicant while validating the personal loan application.They want to see a steady flow of income in the applicant’s account every month; at least latest 6 months income inflow is considered. A regular job hopper might also find it difficult to get a personal loan.
Check the eligibility
The eligibility criteria for getting a personal loan also matters in the process of personal loan application validation. For example, the applicant should be within the age group of 18-60 years to get the loan. The bank might also have some specific requirements to approve the personal loan.
Proper document submission
Personal loan application validation involves minimal documentation but, submission of proper documents is important to get your loan application approved. Usually banks ask for proof of identity, address, income and processing fee cheque. If valid and self- attested copies of these documents are submitted, applicants can avail the loan easily.
Personal loan is a tool to sort out temporary money crunches hence, for positive personal loan application validation,it is highly critical that you evaluate all the above ways and make an informed decision on the loan amount you wish to avail.