Eligibility Criteria to Get a Pre-approved Personal Loan

pre-approved offers

While it might sound bizarre to some people, creating a financial cushion for yourself and your loved ones does come in handy. To this effect, a pre-approved personal loan comes forth as a viable solution owing to its features and multiple benefits. In usual circumstances, you might rely on a personal loan to tide over tough financial times. But with a pre-approved version at hand, the waiting time is reduced even further. Lenders might also lower the personal loan interest rate, thus making it easier for you to repay, 

If you have maintained a positive financial profile with due diligence and are on good terms with your lenders, then check pre approved offers. Start by checking your eligibility and going through the list of documents specified by the lender. Next, explore the various channels and submit your application once you have identified the most appropriate course of action. 

How to check if you are eligible

Eligibility plays the most crucial role in the case of a pre-approved personal loan. To avail of this loan you need to convince the lenders that you are deserving of this special consideration. From the lender’s perspective, the following aspects of your financial standing serve as the criteria for being considered – 

  • Your loan repayment history, wherein promptness indicates a disciplined financial behaviour, and defaulting can go against you;
  • What the latest credit report says about your credit score, debts, income, and so on, as in the higher the score, the more eligible you are;
  • Whether you have any outstanding loan repayments with the lender in terms of the amount already paid and that remaining;
  • Any significant increase in your income, which might have added to your financial capability;

Now that you are aware of the factors that impact your eligibility for pre-approved offers, it is time to take appropriate steps. Indeed it is possible to adjust your financial situation to improve eligibility. Areas that you can work on include – 

  • Minimizing loan applications as much as possible to convince the lender of your good financial standing;
  • Consolidating all your debt to make repayment easy and more systematic;
  • Not availing of any loan from the lender six months before applying for a pre-approved loan;
  • Building up a healthy credit score over some time;
  • Paying all dues on time;
  • Ensuring that the EMI does not exceed two-thirds of your net income;

At this point, you must also use the personal loan EMI calculator and ascertain the amount you will need to repay if you qualify for this loan. The calculator will also provide information regarding the tenure for repaying the loan and enables you to identify a suitable arrangement.

While applying – Points to consider

A pre approved personal loan comes under the ‘Invitation to Apply’ category from the lender to the borrower and hence is akin to a privilege. Therefore, like all privileges, this offer comes with an expiry date. So, if you wish to accrue the benefits of pre-approved offers, you must apply when the proposal is on the table and before it expires. 

Lenders also levy fees to process pre-approved offers, so you must inquire about these if you are interested. Charges involved in a pre-approved personal loan offer include – 

  • Personal loan interest rate, which is added to the monthly installment;
  • Processing fee, which is a certain percentage of the loan amount;
  • Bounce charge, in case your cheque bounces;
  • Penal interest, which is a certain percentage of the EMI that lenders levy in case you default on the monthly payment;

Requisite Documentation

When it comes to regular customers, lenders do not ask for documents since the KYC will have been completed at the time of opening an account. For verification, some lenders might ask for a cancelled cheque, along with the salary statements for the past three months. But this may not apply to all lenders, and requirements vary as per individual policies. 

First-time customers, however, need to present all the documents to prove their eligibility, from their citizenship to their address, identity, income, and so on. Having accepted the documents the onus is on the lenders to check their veracity and then decide whether or not to grant the pre-approved loan. 

Final Thoughts

You can apply for a pre-approved personal loan either online or offline. Opting for the former saves you a trip to the lender’s office since you can complete the procedure via the website regardless of your location. For offline submission, you would need to visit the lender’s premises, furnish all the documents in person, and await their decision, which might take a few days. 

Regardless of the mode of application, the features of this loan would be the same for all applicants. It does not require collateral or security, and is usually disbursed within the day. One of the foremost benefits is the ease of repayment wherein the applicant can choose the tenure and the amount to be paid every month. The personal loan interest rate is also lower, which works well for the applicant. 

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