In a context of inflation and the constant increase in the cost of living, instant personal loans have become the need of the hour for employees. An instant personal loan can be used for a variety of reasons, including a wedding, a family vacation, or simply to meet unexpected and immediate expenses.
It has become much easier to get an instant personal loan today. Personal loan interest rates have also decreased, allowing vastly improved access.
Through Finserv MARKETS, you can easily avail personal loans of up to Rs. 25 lakhs with an interest rate starting from 10.49%. The loan can also be repaid easily, with a flexible repayment term of 5 years.
To check your eligibility for a personal loan, you can check the personal loan eligibility calculator shared by most personal loan providers on their websites.
Factors That Affect Personal Loan Eligibility
Although a calculator can tell you how much you can get as a personal loan, it’s important to understand the factors that could affect your eligibility for one. Read below to learn about the different factors that personal loan providers take into account when assessing your eligibility.
This is the most important factor in assessing your personal loan eligibility as it determines your ability to repay your loan.
The city and locality where you live can often determine your standard of living, and whether your place of residence is rented or owned can help the provider understand your financial obligations and, therefore, your eligibility for a personal loan.
Debt to income ratio:
Your current debt ratio is an indicator of your financial obligations and your well-being. If your debt-to-equity ratio is too high, your personal loan provider might be concerned about your inability to repay the loan. This could certainly hurt your chances of enjoying a immediate personal loan.
The company you work for also has an important role to play in terms of personal loan eligibility. Since the reputation of the company you work for is taken into account when calculating your credit score, it can also impact your eligibility for a personal loan.
Calculated by TransUnion CIBIL Limited (CIBIL), your credit score represents your money management skills. It demonstrates how responsible you are when it comes to credit and will help the loan provider assess your eligibility for an instant personal loan.
How to improve your eligibility for a personal loan
Sometimes, despite your best efforts, you may not qualify for an instant personal loan. However, do not despair since it is possible to improve your eligibility in many ways. Read below to find out how you can improve your eligibility for a personal loan.
Maintain a stable income:
For an instant personal loan provider, it is extremely important that you have a stable income. Try not to change jobs too often, as this may affect your ability to repay the loan and affect your eligibility for a personal loan.
Improve your credit score:
A CIBIL credit score above 750 is considered a good score, while anything below could suggest a lack of effective financial management for a lender. If your score is below 750, you can increase it in several ways. You can cancel any credit cards you don’t use or close inactive bank accounts. You can also get into the habit of starting to pay your credit card bills earlier.
Reduce or eliminate your debt:
If you have outstanding payments on your student loan, home loan, or even credit card, make sure to pay them off as soon as possible. This will significantly lower your debt ratio and make it easier for you to get a loan.
Limit your loan requests:
While your eligibility is assessed, your financial history is reviewed. If you have made too many loan applications in a short period of time, the lender feels that your financial health is not good. Ideally, do not apply for a loan more than once in a 6 month period.
By following the above steps, it will be easy for salaried people to qualify for instant personal loans. It is advisable to go through Finserv MARKETS, where you can avail loans of up to Rs. 25 lakhs, with low interest rates on personal loans, which can be repaid over a flexible term of 5 years.
This article was written by Mithilesh Singh. He is a writer, specializing in writing content on insurance and finance topics. He is a digital marketing consultant, blogger and co-founder of Technical overview.