Personal loans are popular among the masses for various reasons. With the rise in their popularity, platforms where you can get personal loans, have also increased. You have simplified access to an easy-to-use online application process, quick approvals, and affordable repayment tenures. These many choices put you in a dilemma about going through the entire process, which can be overwhelming. Now, every lender available in the marketplace is different from the other in one or more ways. One of the ways how lenders differ is the eligibility criteria set by them for the borrowers. It affects how much you can borrow, and you can also know this by using a personal loan calculator online on your own.

Getting the Process of Personal Loan Application Sorted

You do not need to unnecessarily worry about applying for a personal loan. The more you worry, the more you will be overwhelmed. There is nothing that complex about the process that you cannot understand, especially if you know to utilise the right personal loan calculator. Let’s look at some things you must remember before or during your application for a personal loan.

• Track Your Finances

A high credit score is one of the first criteria to be seen by the lender to determine whether you are an ideal candidate for the loan. If you will have a good CIBIL score, it reflects good creditworthiness. A lender is more at ease to loan a person with a high credit score as it assures repayment. However, if the score is low, the loan application will be rejected, or the loan will have high personal loan rates.

Besides the credit score, many other parameters, like age, income, employment history, FOIR, and average bank balance, are also considered. Lenders take this information by assessing the last quarter’s bank details of the borrower. You can increase your loan approval chances by clearing your bills and debts and reducing expenses. If any of the mentioned factors are not up to par, it is better to work on your finances and credit for 1-3 months and apply later. 

• Consider the Loan’s Eligibility Criteria

Who doesn’t want to save a few bucks when getting a good deal? The same is true when you look for personal loans. Most look for loans with low rates, but it shouldn’t be the only deciding factor. The other factor that shouldn’t be ignored is the EMI you are going to pay, which you can calculate from a personal loan calculator. 

Why are monthly EMIs important? Because your capacity to pay EMIs affects many other things like your eligibility to get a future loan and credit score. Do not run after low-interest rates to end up paying higher EMIs. Therefore, using a personal loan calculator is recommended to know what your monthly EMI will come out to be. 

• Check Your Documents

Every bank or NBFC follows a compulsory KYC process before they offer their services to the customer. It is for verifying the identity of the customer. So, be ready and check all your documents and arrange them in a file. The most common documents are age, identity, salary, and address proof. 

The loan application gets rejected if there is any fault in the documents. So, make sure you recheck the documents for accuracy. 

Conclusion

While a personal loan application might seem overwhelming and confusing at first, there are ways you can ensure the process goes smoothly. You can wait to show improvement if there is an area you may think is lacking somewhere. 

You also want to check the lender’s reputation and criteria for qualifying for the loan. You must know what kind of personal loan calculator the lender is using. All this will help you secure a better personal loan.