A Personal Loan is an extremely useful financial resource. You can use it to take care of a host of expenses such as going on an international holiday, buying a car, urgent healthcare bills, or paying for your child’s education. However, you have to first qualify for a Personal Loan based on your lender’s eligibility criteria.
Lenders usually look at the following details to judge your eligibility.
1) Income and Employment to ascertain your Repayment Capacity
To get a loan sanction easily, it is important that you meet the minimum salary requirement based on where you live, and have a steady job that pays you regularly. If you work at a reputed company and your job profile is low-risk, your chances are better. These factors help the lender establish whether or not you can repay the loan.
2) Age, Credit Score and Existing Debt to Check your Creditworthiness
Your age helps the lender determine how many years you have left before retirement, which indicates if you will be able to repay the loan with ease. Your creditworthiness also helps the lender decide if you are a high-risk or low-risk candidate. A good score boosts your chances of getting approval and a low score brings it down. Similarly, if you have too much existing debt, the lender is likely to doubt your repayment ability.
Using a Personal Loan eligibility calculator makes it easier for you to see if you qualify for a Personal Loan. All you have to do is enter a few details into the calculator. Here is a look at what they are.
- Date of birth
- Pin code
- Employer’s/company’s name
- Net salary
- Combined monthly EMIs
- Outstanding credit card amount
- Whether or not you have an existing home loan
Once you enter the details, you can check the following:
- Eligibility: The calculator will first tell you if you are eligible for the loan with the specific lender. If not, you can work towards increasing your net salary or reducing outstanding debt and then try applying for a Personal Loan
- Prospective Amount: Secondly, the calculator gives you an estimate of the amount that you can borrow as a Personal Loan, based on the details that you have fed into the calculator. This is extremely useful as it tells you up front if the loan is suited to your needs.
Once you have checked your eligibility, you can proceed with applying for a Personal Loan. However, keep in mind that you will need to prove your eligibility when you apply, so ensure that you are honest about the information that you put in the calculator.
Personal Loan documents that prove you are eligible usually include the following:
- KYC documents
- Employee ID card
- Salary slips of the past 2 months
- Bank account statements of your salary account for the past 3 months
Ensure that you calculate your Personal Loan eligibility before proceeding with a loan application. This will avoid chances of rejection and ensure that you get access to funds quickly.