91-9711165183
A Personal Loan offers an incredible option for accessing immediate funds without collateral. Whether it’s medical emergencies, dream weddings, long-awaited vacations, or home renovation projects, a Personal Loan helps you fund any expense.
An applicant can Apply for a Personal Loan from any Bank or NBFC. Still, the lender will issue the loan if the applicant’s profile fulfils the Bank’s eligibility criteria. The main factors determining the eligibility criteria of the Bank include the following.
As the personal loan is issued for lifestyle needs, the HDFC Bank and ICICI Bank norms require that an applicant draw a salary of ₹ 30k or above, which is transferred monthly to the salary account. A net salary of ₹ 25k is the norm for NBFCs like Tata Capital or IDFC Bank. Individuals earning a salary of ₹ 75k or more are offered special discounts and benefits of HDFC Golden Edge Personal Loan.
It is mandatory to check if the employer is included in the Company Category List HDFC Bank, the leading personal loans lender, has a comprehensive list of categories A, B, C, and D. An applicant whose employer features in the A category has the eligibility to receive higher loan amounts with lower interest rate as compared to Cat C or D employees for whom the eligibility is calculated with restrictions.
An applicant’s Credit Score is viewed as a crucial factor in determining Eligibility for a Personal Loan. A credit score of 750 or more signifies that you are a responsible borrower who has timely repaid all past dues and will be granted a loan in the most suitable terms, such as a discount on the processing fees. At the same time, a delay in repayments or a settled loan track will negate Personal Loan Eligibility.
The calculation for the Loan amount granted to an applicant is broadly judged by the applicant’s ability to repay the loan. After budgeting for all other monthly expenses, the customer must be comfortable paying the monthly instalment. Thus, individuals earning a higher salary can pay an increased EMI and are issued enhanced loan amounts.
Another significant factor is the repayment term banks permit applicants to repay the loan via EMI (equated monthly instalment) over 12 to 72 months.
Customers who require more significant sums can request a longer repayment term so that the EMI is affordable, as the interest on a personal loan is charged yearly. An applicant can use the Personal Loan EMI Calculator to arrive at a suitable EMI, which helps customers assess their eligibility by filling in the basic details:
The EMI Calculator will display the EMI if it is unsuitable, the applicant can change the inputs by entering a lesser loan amount or a longer tenure to arrive at a convenient instalment. An EMI Calculator is handy as it helps plan a monthly budget by estimating the EMI and determining the credit amount an applicant is eligible for.
Numerous factors are considered when determining your Eligibility for a Personal Loan, but it mainly assesses your past debt management and capacity to repay the new debt. To boost your Loan eligibility, consider working on the following areas.
Pay all credit card bills on time and keep enough balance in your account to clear your loan instalments. Having a credit score of 750 and above signifies that you are a responsible borrower who has timely repaid all past dues. As the lender’s risk is minimised, your approval chances are enhanced.
A credit score below 750 implies an unsatisfactory repayment track record. As a result, the lender classifies you as a high-risk candidate, potentially leading to higher interest rates or even outright rejection of your application.
Decrease your debt before Applying for a Personal Loan, enhancing your debt-to-income ratio. For example, you have a Car Loan, and an EMI of Rs 13000 monthly from your monthly income of Rs 25000 goes toward it.
In this case, your debt-to-income ratio would be calculated as (13,000)/25,000 = 0.52 = 52%, indicating that your liabilities surpass your income. In this scenario, to boost your Eligibility for a Personal Loan, consider either increasing your income to bridge the gap or paying off your current debts, thereby reducing your debt-to-income ratio to a desirable range of 20% to 35%.
Lenders need to understand your repayment intentions. A higher income significantly improves the chances of loan approval. You can show evidence of other income sources to boost your payment, such as performance incentives, bonuses, variable pay, passive income from investments, and more.
All these factors can significantly enhance your Eligibility for a Personal Loan. Presenting the lender with evidence of your multiple income sources and primary monthly income instils confidence regarding your capacity to repay the loan.
During the Personal Loan Application Process, the lender reviews your credit report to assess your creditworthiness. If you have applied for Personal Loans from various lenders, they will seek access to your credit report.
Such inquiries are considered hard inquiries and are documented in your credit report. Hence, submitting multiple loan applications simultaneously has a minor impact, as it may portray you as excessively credit-hungry.
Avoid Frequent Job Changes
Along with various other factors, an applicant’s employment history and stability play a significant role in lenders’ evaluation of their Personal Loan Eligibility. Frequent job changes can make lenders hesitant to provide personal loans since they indicate a lack of career stability, resulting in increased credit risk.
Thus, it is advisable for individuals planning to Apply for a Personal Loan shortly to minimise job hopping as much as possible.
In conclusion, the lender will judge your eligibility criteria before sanctioning the loan amount. Although the essential eligibility criteria for a personal loan are similar to those of most Banks and NBFCs, each lender has an individual policy.
It is not necessary that if an applicant faces rejection from one lender, no other lender will grant a loan unless the applicant’s credit record has a settled loan track, there are undue delays in repayment of the loan, or there is an EMI Bounce.
Secure lenders, such as mortgage lenders, judge the request based on the applicant’s profile and the property, but the main factor for approval of an unsecured personal loan is the eligibility criteria.
Are you dreaming of exploring the globe or envisioning your perfect wedding? Choose a Personal Loan and transform your dreams into reality.
Whether you need assistance to overcome a financial challenge, manage unexpected expenses, or pay off debt faster, a Personal Loan can provide the necessary support.
Regarding Personal Loans, there’s no need to worry about collateral or security since they are usually unsecured loans designed to provide financial assistance.
Banks focus solely on the eligibility and creditworthiness of the borrower for issuing an unsecured Personal Loan as for the borrower receiving funding via a Personal Loan is a quick and seamless experience, more so with the convenience of online processing.
Typically, the borrower should fall within the age bracket of 18-21 to 60-65 years to meet the eligibility criteria.
Banks offer Personal Loans to salaried individuals employed in Government entities, recognised multinational corporations (MNCs), and public or private companies. Banks also offer Personal Loan facilities to self-employed applicants who can provide proof of business existence, income tax returns (ITRs), and other essential financial documents.
The applicants should provide the necessary KYC (Know Your Customer) and Income proof per the documents list.
The applicant’s income must be above the minimum required benchmark to meet the eligibility criteria required for a Personal Loan.
It is mandatory to have a specific duration of employment or business existence.
The CIBIL rating of the applicant is an essential criterion for Personal Loan approval a minimum score of 720 points is required by most lenders, with an on-time repayment record for all credit taken.
So when you apply for a Personal Loan, you must consider the above points to get the loan approved quickly.
Asses as to what is your loan requirement and repayment capacity?
The primary objective for both you and lenders is to ensure that you do not find yourself in a position where you obtain a personal loan and face the inability to meet the financial obligations for its repayment.
To steer clear of this situation, begin by assessing the amount of funds you will need while keeping in mind that specific lenders may also levy an origination fee.
Now, with the help of a Personal Loan Eligibility Calculator, determine the monthly payment amount for your loan. It can be challenging if you are not aware of the rates and repayment terms the lenders will provide. However, you can experiment with the numbers to estimate the potential cost of the loan and determine whether your budget can accommodate it.
Before Applying For a Personal Loan, inquire about any origination fee or upfront costs imposed by the lender to help determine the monthly payment you can comfortably afford.
Before deciding on any lender, you should thoroughly research to find the best per your need. To know more, Please Check Details of Primary Lenders.
For immediate financial needs, a Personal Loan provides swift access to funds. Personal Loans come with flexible payment options for up to 72 months. The terms and conditions may vary according to the profile of the customer and the loan amount approved. Here is a guide to understand how to Apply For a Personal Loan.
Documentation forms the basis for processing a Personal Loan. Therefore, the applicant must provide complete, valid, and clear copies. Before the commencement of the application process, an Applicant should ensure the availability of the required documents to expedite the Personal Loan Process. Primary documents are standard for most lenders, which include the following.
Proof of Identity can be either: an Aadhaar card/Pan Car/ Driving License/Passport with a Passport size photograph.
Proof of the Residential Address where you reside: An Aadhaar card copy with the applicant’s current or permanent address has become mandatory for most lenders.
If the Aadhaar card reflects a permanent address, the applicant has to submit a current address proof valid document for the same, including Passport/ Driving License/ Voter ID or any other government-recognized document.
Signature Proof: A Pan Card or a Bankers’ verified proof is required to authenticate the applicant’s signature.
Income Documents: That will confirm the applicant’s monthly income to calculate the eligibility for the loan amount; valid income proof is to be submitted. These Include:
Salary slips for the last two months to know the monthly remuneration of the applicant and a Form 16 for proof of continuity.
A self-employed customer needs to submit the Income Tax Returns filed for the last three years
A Bank statement for the previous three months for the salary account of a salaried applicant and a self-employed applicant has to submit six months’ Banking of all Company and personal Bank accounts and proof of Business vintage. Most lenders demand own
hip proof for self-employed persons. It could be either the office or the residence.
Once the documentation is in hand, you must fill out an application form for a personal loan. You can fill out the form online or offline by visiting the nearest branch of the Bank. However, when you apply for an Instant Personal Loan Online, you simplify the process and effectively save time. The details filled in the form must be accurate and match the documentation further, apply along with the documents for further processing.
On receipt of the application, the Bank verifies the Documents and customer details and initiates a reference number. The applicant is informed of the file number via a Mobile SMS.
The Bank will next review your Credit Score and evaluate factors such as your repayment history, The CIBIL Score allotted must be above the required benchmark. There should be no delays or defaults in the applicant’s credit history.
A bank representative may conduct a home visit to verify the address provided in your application. Furthermore, suppose the applicant is unavailable at the home address. In that case, a neighbour check is done, or if the residence is rented, the landlord is asked to confirm the applicant resides at the given contact address.
Ownership proof is required if the residence is self-owned, which will expedite the verification processing.
The employer verification is waived if the applicant provides an email contact from the company domain. If not, a representative will visit the office premises to confirm the customer’s employment details.
The verification is more detailed for self-employed persons, with a Bank officer physically visiting the office premises to verify details and check the profile.
If you hold an account with the Bank, getting access to instant personal loan approval within seconds is quite convenient. This digital solution ensures a seamless and effortless borrowing experience, assisting customers in fulfilling their urgent financial requirements.
It is paperless and In1stant Online Personal Loan disbursal for saving account holders, so if you have an account with the Bank, you can visit the website and apply for a loan once it is approved, the amount will be disbursed in no time.
With all the above checks conducted positively, the Underwriter can check if the applicant meets the Personal Loan Eligibility Criteria Requirements. A financial calculation confirms the existing credit and obligations and whether the applicant can comfortably pay the monthly instalment for the loan amount requested.
On completion of the process, the essential terms and conditions of the Personal Loan are tabulated and communicated to the applicant. These include:
The customer accepts the lender’s Loan terms by signing an agreement all other charges are notified to the applicant, such as the Foreclosure and Part payment terms and additional fees. At this stage, the customer must be aware of the notifications and forward queries, if any. The Personal Loan terms, once decided, remain fixed for the entire tenure.
The Loan amount is transferred to the applicant’s account by ECS (electronic clearing services). Subsequently, the installment is presented to the customer’s account on a designated date per the fixed term.
A loan schedule is dispatched with the number of EMI and the break up therein.
The Bank transfers the funds approved via a Personal Loan to the customer’s account within 72 hours of the application. Most Banks have adapted to digital processes where feasible and are streamlining processing further to make a Personal readily available when needed!
An understanding of the know-how of the Personal Loan process will help our esteemed clients to receive funds without any delays or glitches.
What do you do when a financial emergency knocks at your door? If you have enough money for the expenditure, any urgent financial situation sways away. However, loans feel like the only viable situation if you fall short of money. While conventional loans are sought by many individuals, ICICI Personal Loan Top-Ups also serve as a more flexible and convenient alternative. Wondering what is a Top-Up Loan and how it works? Grab your reading glasses, sit back, and delve into this guide to discover more!
As its name suggests, the top-up loan allows you to borrow additional funds on top of your existing loan. If you have an existing loan, a Top-Up Loan offers a hassle-free and quick way to access additional funds while eliminating the need for extra paperwork. It also has lower interest rates as compared to Personal Loans. For instance, if a borrower needs funds for home renovation, education, or medical expenses, a top-up loan can be more cost-effective than applying for a fresh loan with higher interest rates.
Borrowers who Apply For ICICI Bank Top Up Personal Loans can use funds as per their requirements and the documentation is simple. In addition, timely repayment of a top-up loan can also positively impact the borrower’s credit score by demonstrating their financial discipline. To be eligible for a top-up loan, the applicant must meet the following criteria:
Before you get a Top-Up Loan on paper, here are some cost components associated with it:
Calculating the total costs involved in a Personal Loan Top-Up can help borrowers understand the financial implications and make informed decisions. Here’s a summary of the key factors to consider:
Several factors affect the cost of a top-up loan, but you can consider these two:
While a Top-Up Loan can be a cost-effective and convenient way to access additional funds when you have an existing loan, different banks have different terms and conditions. Navigating through the financial ecosystem of Personal Top-Up Loans can be daunting. Whether you Apply For a Top-up Loan at ICICI or any other financial institution, ensure to work with professionals to make well-informed financial decisions.
Need more help with the ICICI Personal Loan Top-Up Procedure? Contact the professionals at Your Loan Advisors now!
In the economic landscape, Personal Loans have become a convenient solution for individuals seeking financial aid for different reasons. However, individuals may find themselves burdened with inflexible repayment terms, high-interest rates, and sometimes multiple loans. This is where Personal Loan Balance Transfer comes into the big picture, offering individuals a way to alleviate their financial stress. Wondering how? Read on to find out!
On paper, a Personal Loan Transfer can be defined as a process wherein you transfer the outstanding balance of your existing loan to a new lender offering better terms and conditions. The priority here is paying the loan amount back successfully without any delays or bounces.
Typically, the tenure allotted for a Personal Loan Balance Transfer is between 12 to 60 months, and the tenure is granted on the eligibility of the applicant to re-pay the EMI and the sanctioned loan amount. Also, as the transfer process is unsecured as you can avail of it without any security guarantee or mortgage.
Although a Personal Loan Balance Transfer has many advantages, here are some things to consider before the transfer:
When you become diligent in your financial approach and assess the fine print, risk factors, and perks from various lenders, a Balance Transfer Personal Loan can help you save money, reduce stress and achieve better financial stability. However, if you need the help of seasoned professionals along the way, Your Loan Advisors are an excellent option.
When you pick Your Loan Advisors for assisting you with your Personal Loan Balance Transfer, you get transparent insights into market offerings. Discuss your options with the giants in the field, avail the best deals, and get a personalised analysis of your saving and other financial perks.
Everyone has dreams, and many of them are difficult to achieve. Among the many reasons, you are not able to fulfill your wishes is the lack of sufficient financial means.
Now being short on cash shouldn’t hold you back from pursuing your desires any longer. You can easily go for a Personal Loan and make your dream come true as numerous Banks and NBFCs offer quick and convenient funding.
But before taking on a Personal Loan it is imperative to consider reading fine print such as repayment tenure, interest rate, and miscellaneous charges, as it has a considerable impact on your borrowing cost and EMI.
Before making a big purchase or engaging in a financial transaction, it’s wise to do your research properly. The more you understand the borrowing cost, the more beneficial it will be for you in the long term.
For instance, along with the principal amount, you’ll also be paying the cost of borrowing (interest) which depends on the repayment term you’re offered.
However, understanding the terms and conditions along with the fine print associated with them can be quite challenging thus after gathering all the relevant information, you can conveniently calculate your monthly payment using a Loan Calculator or a simple equation.
To calculate your payments, it’s imperative to understand the ins and outs of how the payment systems work. Besides the principal amount of your loan, you are responsible for paying interest and any additional fees linked to a Personal Loan.
When figuring out the affordability, focus on the loan’s principal amount, the annual percentage rate (APR), and the applicable fees.
In the majority of Personal Loans, your monthly payments remain consistent throughout the duration of the loan. Interest rates, including APRs, are determined based on your credit score and history. A higher credit score typically results in a lower interest rate.
To understand how the actual total interest is calculated, it’s important to know concepts such as APR and the various types of interest rates.
Let’s understand APR and how it affects your interest rate.
Lenders apply interest charges when providing you with a loan amount. The interest calculated annually on such a loan is referred to as the Annual Percentage Rate (APR).
The APR applied to your loan enables you to calculate the actual cost of borrowing over a specific period. It signifies the annual cost of a loan and is expressed in percentage.
Annual Percentage Rate (APR) refers to the interest rate and financing fee associated with a loan and its repayments. The APR is influenced by numerous factors such as your loan amount, repayment duration, and credit history.
The Annual Percentage Rate takes into consideration the nominal interest rate along with other fees associated with availing and servicing a loan. The fees comprise administrative costs, insurance expenses, processing fees, and similar expenditures.
However, an APR does not consider the compounding aspect when calculating the actual borrowing cost of a loan.
When determining the true cost of borrowing, relying solely on the Annual Interest Rate (AIR) would not reveal the loan’s actual cost. Lenders promote this interest rate as a means to attract customers to their services.
Numerous lenders intentionally maintain a low Annual Interest Rate while simultaneously keeping the other charges. Consequently, customers often remain unaware of the actual cost of the loan.
Now, the Annual Percentage Rate (APR) is essential for you as it has the potential to determine whether your loan is affordable or expensive. Therefore, you must evaluate your loan’s APR before proceeding with the decision to move forward.
When availing of a loan, it is imperative to thoroughly examine the repayment terms and conditions. Hefty repayments have the potential to disrupt your monthly budget.
Therefore, it is essential to carefully consider every aspect of your loan and repayment. The Annual Percentage Rate (APR) is one such aspect that requires your thoughtful deliberation.
Here is The Formula to Calculate APR:
APR = [(Total interest + other Fees)/Principal amount/Tenure of Loan)
For instance, Amit is seeking a personal loan of ₹ 500000/- that he would pay off in a tenure of 3 years. The processing fee is 1% and the interest rate is 12% at a reducing balance (6.5% flat per year) Let’s assume the insurance cost is Rs 6000. Subsequently, the APR of the loan will be calculated as follows:
Hence, the actual cost of the loan amounts to 108,693.00 for a 3-year tenure, the loan amount of ₹ 500000 borrowed.
The amount of your monthly payment is determined by the debt amount and the chosen repayment term.
For instance, a loan amount of ₹ 500000 paid over 5 years of tenure will have a lower monthly payment compared to a ₹ 500000 loan paid over 3 years of tenure because the payments are distributed over an extended duration, allowing for a longer repayment period.
Gaining a thorough understanding of the APR is crucial to ensure that you can comfortably afford the loan repayments. Considering the loan type is one of the best ways to save money on interest rates.
There are 2 types of loans secured loans and unsecured loans thus, the type of loan you choose affects your repayment. To understand the impact of APR on your interest, let us first learn about secured and unsecured Personal Loans.
In Secured loans, collateral is required as a means to secure the loan amount. Although finding collateral may not be easy. Opting for a secured loan can significantly lower your APR. Therefore, repayment becomes less burdensome when opting for secured loans.
With unsecured loans, you don’t need any collateral to secure the loan, when you choose to go for unsecured loans, your APR and repayments are comparatively higher.
You should always consider all the factors before choosing any loan as it can affect your repayments. This is a good way to avoid defaulting on repayments thus, maintaining a good credit score.
The initial step to reduce your EMIs is to steer clear of overly hyped interest rates and be aware of the APR associated with the loan.
Now, let’s talk about the second step – understanding the type of interest rates.
While opting for a personal loan you should be aware of the type of interest application. Here are two ways to calculate the interest rate.
Explore all the essential information about the two methods of calculating interest rates below. Also, get a clear understanding of the difference between the two types of loans.
Traditionally, this method of interest calculation has been applied to Personal Loans. It is also known as a fixed interest rate, and the technique is pretty simple to understand.
When considering a flat interest rate, the interest is calculated based on the entire loan amount, which is commonly referred to as the principal.
Initially, the total interest on your loan is calculated, followed by its addition to the principal amount. The total amount is then divided equally across your repayment tenure.
When a flat interest rate is implemented, your monthly deductions remain the same throughout the tenure. Regardless of whether you’re paying your first EMI or the second-last EMI when opting for a fixed interest rate.
In the reducing interest method, your obligation reduces every month. The interest rate is determined based on the remaining principal amount, which decreases every month.
In this method, as you make your monthly EMIs, a fraction is allocated towards interest payment, while the remaining portion is utilized to gradually reduce your principal amount.
Thus, your principal amount steadily reduces month on month. Hence, the interest amount calculated on the principal also decreases accordingly. Therefore, your interest amount progressively decreases with each EMI.
Once you are thorough with the various methods of calculation employed by lenders to calculate the interest on your loan, it’s natural for the question to arise in your mind “Which interest calculation method is most transparent?
Among the available interest calculation methods, the reducing interest rate method works best Most Banks and NBFCs apply the reducing interest rate, for a constant EMI and which indicates clearly month on month the amount paid as interest and the principal balance of the loan.
However, before going for any Personal Loan, you should have a clear understanding of your loan terms and the employed interest calculation method.
A Personal Loan Calculator can provide you with an estimation of your monthly payment, total interest paid, and the overall amount paid based on a specific loan amount. After completing all the necessary calculations, you can take the next step and:
When securing a Personal Loan, the primary concern revolves around: “What will be the total cost and monthly repayment?
Your Repayment amount will be greater than the borrowed sum, given that your EMI covers both the principal and the interest.
It is imperative to understand that the borrowing cost of your loan is influenced by numerous factors such as loan type, loan amount, repayment tenure, creditworthiness, and other relevant considerations. What you must ensure is that you possess sufficient repayment capacity to effectively repay the loan and avoid a default.
No matter, whether It’s for a luxury purchase or an emergency expense, just with a minimum hassle a Personal Loan can provide you with financial support. In India, with the passing years Personal Loans have gained immense popularity. The advent of online lending platforms has transformed the process of Applying For Personal Loans, making it more convenient than ever to obtain fast funds.
So now if you wish to travel to your dream destination or fulfill some of your lifestyle needs you don’t have to worry much, as the best Personal Loan can help you achieve all this in no time. But there are numerous things that one should consider prior to going for a Personal Loan. Let’s walk you through some of the points to consider that would help you to avail of the best Personal Loan.
ICICI Bank is offering an attractive interest rate of as little as 10.50% p.a. depending upon certain criteria. The interest rate is calculated on the outstanding loan amount every month besides getting levied on a diminishing balance.
Here are Some of the Key Characteristics of ICICI Bank Personal Loans.
| Rate of Interest | 10.50% to 18.49% p.a. |
| Age | Salaried – 23 to 58 Years, Self-employed – 25 to 65 Years |
| Loan Amount | Up to 20 Lacs |
| Processing Fees | Up to 2.25% p.a. of loan amount + GST |
| Prepayment charges | 5% p.a. of principal outstanding + GST |
| Tenure | From 12 to 60 months |
HDFC Bank is known as one of the leading private-sector banks. It offers a range of various banking products at a competitive interest rate. You can check your eligibility for HDFC Bank in just 1 minute online besides at some of the selected branches you can check through its Personal Loan Eligibility Calculator Tool.
Why Should You Consider HDFC Bank Personal Loan?
Below are Some of The Key Characteristics of HDFC Bank Personal Loans.
| Age | From 21 to 60 Years |
| Interest Rate | Range from 10.50% to 21.50 %p.a. |
| Minimum income requirement | Rs. 15,000 per month |
| Loan amount | Up to Rs. 15 Lac |
| Processing fee | Up to 2.5% of the loan amount with a minimum of Rs. 1,999 |
| Tenure | From 12 months to 60 months |
Axis Bank Personal Loan comes with a super fast and efficient process besides offering outstanding features and numerous advantages including minimal processing fees, flexible payback, and competitive interest rates.
Why Should You Go For Axis Bank Personal Loan?
Here are a few key characteristics of Axis Bank Personal Loan
| Interest Rate | From 12% – 24% p.a. |
| Processing Charges | 1.5% to 2% + GST as applicable |
| Foreclosure charges | 5% |
| Age | 21 to 60 years |
| Minimum income requirement | Rs. 15,000 |
| Loan amount | Rs, 50,000 to 15 Lacs |
| Tenure | Up to 60 months |
YES Bank offers collateral-free personal loans of up to Rs 40 lacs at an attractive interest rate.
Why Should You Consider YES Bank Personal Loan?
| Loan Amount | Rs. 1 Lakh – Rs. 40 Lakhs |
| Tenure | 1-5 years |
| Interest Rate | 10.99% p.a. onwards |
| Processing Fees | Up to Rs. 4,999 or up to 2.5% of the loan amount |
| Minimum Monthly Income | Rs. 18,000 or Rs. 25,000 |
Here, we present a comprehensive list of the best Personal Loan plans available in India. In addition to the ones already mentioned here, there are numerous other loan plans in India that provide quick Personal Loans.
Listed below is some common eligibility criteria of leading Personal Loan providers in India.
Minimum Age: For salaried applicants, the minimum age should be 21 years when applying for a loan, whereas for self-employed the age required is 25 years.
Maximum Age: At the time of loan maturity salaried persons should not be above 60 years. Whereas the maximum age of a self-employed person should be less than 65 years at the time of loan maturity.
Occupation: A salaried individual should be working with a reputed government or private company. Self-employed non-professional, self-employed professionals such as doctors, architects, chartered accountants, and so on.
Nationality: One should have Indian nationality to be eligible.
CIBIL Score: To avail of the best personal loan in India your CIBIL Score should be above 750 or above.
Minimum Income: Your monthly income should be Rs 25,000 or above.
Minimum Work Experience: To get a Personal Loan you should have an experience of at least 2 years and should be serving for at least 1 year with the current employer.
Prior to going for a Personal Loan, you should check for the eligibility criteria to get a better understanding.
Now let’s talk about the factors affecting the Personal Loan Interest Rate
Banks and other financial institutions have established specific criteria for personal loans, based upon which they determine and offer interest rates.
Loan Amount: The most essential factor that usually banks consider is the loan amount that a borrower requires. The loan amount is considered depending on the borrower’s income and occupation. With the increase in loan amount, the interest rate of Personal Loans decreases.
Tenure: The tenure of the loan directly influences the interest rate. Thus, with the increase in tenure interest rate decrease.
Income of the Borrower: The interest rate of your loan directly depends on your income. If you have a higher income and steady revenue stream the lenders will be convinced that you will be able to make loan payments on time. Thus, if you have a higher income you can be benefited with a cheaper interest rate.
Repayment Capacity: One of the key factors that are determined to consider interest rate is the ability of an individual to repay debt. Usually, lenders believe that if a borrower doesn’t have too many financial obligations he/she can repay the loan on time.
Credit Score: Depending upon your credit score lenders determine the loan amount and the interest rate. If you have a credit score of 750 and above then the interest rate might be considerably low.
These are some of the key factors that are considered by lenders while finalizing the interest rate for your Personal Loan.
Here are some of the crucial points to consider to avail of a Personal Loan with a low-interest rate.
There are numerous things to keep in mind to choose the Best Personal Loan.
With a few simple steps, you can Apply for a Personal Loan and get it disbursed in a few days.
It’s important to know the pros and cons of Personal Loans when you’re looking for a lender and deciding whether to Apply for a Personal Loan. Let’s walk you through the pros and cons of Personal Loans to get a better understanding.
A Personal Loan can be a wise choice when you are facing financial need, but it’s important to consider the pros and cons associated with it in order to achieve the best outcomes.
Prior to deciding on a Personal Loan it is crucial to have an understanding of the benefits and risks associated with it. No matter Personal Loans can provide quick access to funds but on the other hand, high-interest rates can pose financial risks. Nevertheless, when used responsibly and with thoughtful consideration, Personal Loans can serve as a beneficial tool for accomplishing short-term financial objectives.
Personal Loans are unsecured funding marketed by leading banks and NBFC as short terms loans for individual usage and emergency needs, such as spending on holidays or for educational and medical expenses.
Financers issue Loan amounts starting from ₹ 1 Lakh to 35 Lakhs to salaried persons without a guarantee or security therefore, timely repayment is a priority. Processing Personal Loans is done speedily so that applicants receive the funds within the shortest time frame.
All leading Banks, HDFC Bank, ICICI Bank, AXIS Bank, and YES Bank track growth, verify companies’ financials and prospects and enable a company list to facilitate the funding of Personal Loans.
Individuals with a secure income can manage their obligations successfully therefore, banks look to fund employees of profitable entities with a progressive growth track.
Banks and NBFCs publish an individual list compiled per the Lender’s policies and preferred segments. Most lenders approve loans for applicants employed with companies that feature in their approved list.
Banks construct an approved list of organizations that include private and public limited companies, reputed as the top Employers to work for. Significant inclusions in company lists are from the following sources.
Premier organizations in this list are the ET 500 companies at the end of every year, the ‘Economic Times, a leading business-based daily publication, releases a list of investable companies with good fundamentals. The list also includes similar companies listed as Fortune India 500, compiled based on the latest sales and gross revenue figures.
Companies listed with India’s two major stock exchanges- BSE, the Bombay stock exchange, and NSE- the National stock exchange of India- feature prominently in the Approved Company Lists of Banks. Entities with rising share prices are listed as Category A or Super A other companies are classified as per their performance. Banks closely monitor share values and upgrade or negate companies accordingly.
A Government job ensures stability and a regular income. Therefore, candidates employed in the Government sector are an eligible segment for a Personal Loan. Central and State Government entities feature in the company list for most Banks, with bureaucrats, high ranking government officials in preferred categories.
Banks List Public Ltd, and Private Ltd Companies registered with MCA having a vintage of 5 years and above, with an increasing turnover and profitability Banks, Airlines, Hotels, and corporates with a multinational relationship with high turnovers and a significant workforce feature in the company category list.
Banks encourage applications from listed companies with a salary account in the concerned Bank as details of the financial history are easily accessible.
The hierarchy of the company governs the terms awarded to a customer. The grading remains the same though Banks may name categories individually. For example, a super A company with HDFC Bank is known as the Diamond category with ICICI. Major categorization is as follows.
· Category A or Super A
· Category B
· Category C
· Category D
Banks have individual policies for providing loan terms per the Employer details though the thumb rule remains the same. Given below are details of Personal Loan offerings for companies as per their grading.
Category A/ Super A, or the Top Category/ premier Category, included in this section are elite companies employees of companies included in this Category are a primary focus for marketing a Personal Loan. Therefore, the lowest interest rate with beneficial terms attracts applicants from this Category.
Companies listed in this Category hire the cream from top institutes like IIT and IIM, and the yearly package offered is handsome. Therefore, Banks waive the 3-month vintage rule required to process a Personal Loan.
The highest multiplier is applied to calculate the eligibility for the loan amount to be issued. The requirement for a CIBIL Score is optional, and Banks waive stringent procedures to speedily process a Personal Loan request from a client working with a Top Company.
Category B Companies come a close second in preference. Banks process a request as per the norms and criteria. The stability and continuity of the job is the critical factor. Most established vintage companies feature in this Category.
The multiplier for the Personal Loan amount is lower than that of Category A inclusions. In addition, a review of the CIBIL Score and history physical verification is conducted at the office and residence of the client to confirm contact ability.
Applications from Employees listed with Categories C and D are processed conservatively. The monthly income required by most Banks for this Category is above ₹40 k per month compared to ₹ 25k for a Category A applicant. An application from an employee of this category is viewed on its own strength, a healthy CIBIL Score above 720 basis points and above is required.
There is also a restriction on the maximum loan amount issued.
Government and Public sector entities form a distinct category for funding Personal Loans. A Government employee has the security of an assured income, so applicants are eligible for a maximum loan amount with a discounted interest rate and attractive terms High-ranking bureaucrats get exalted packages, so they are treated similarly to Super A category applicants. The HDFC Bank Processes Applications from all strata of applicants from the Government sector, including blue-collar personnel.
The YES Bank and ICICI Bank Provide Personal loans to seekers working with Non-Listed Companies the criteria applied are as per the norms of the particular Bank. The basic income required by YES Bank to process applications from individuals is a salary of ₹25k and above. In contrast, the compensation needed in ICICI Bank for a non-listed company aspirant is a minimum of ₹ 40k.
A CIBIL Score of 700 points or above is mandatory and customers having a self-owned or living in a family-owned residence are preferred. The loan amount appended depends on the eligibility calculations of the Bank and the customer’s current behaviour with credit.
Banks construct their list of approved Companies per individual policies and targeted profiles. As a result, the terms offered may vary from Bank to Bank for example, an applicant working in the Delhi police can get the best deal from Axis Bank, which holds salaried accounts.
Before applying for a Personal Loan, an applicant should check if the current employer features in the Lender’s approved list to avoid a delay or denial.
Contact our Loan experts at Yourloanadvisors for immediate know-how about your company category. With years of experience, our advisors will help identify the Lender which serves your needs best.
An employee lives a lifestyle affordable as per the salary given, assured that the compensation is received at the end of the month, so they can honour the obligations and pay the EMI on time for all credits taken.
That is precisely what the Banks look for the loan amount given repaid as per schedule. Hence an employer becomes all-important for the Financer when issuing a Personal Loan.
Personal Loans have surged in popularity as a versatile solution for financial requirements. Personal Loans in India have grown by 20% year-on-year to 37.7 trillion rupees, demonstrating the high demand for this form of credit. Leading banks in India offer Personal Loans with competitive terms, allowing customers to choose the options that suit them best.
Here is an attempt to guide you on how to apply successfully for a Personal Loan from the ICICI Bank or other leading banks of your choice. But first, let’s break down everything you need to know about Applying For a Personal Loan!
What do you need your loan for? For what purpose are the Personal Loan funds required? Whether it’s a medical expenditure, home improvements, or an emergency expense, knowing your exact needs will help you find the right financier for your loan.
Additionally, check the eligibility criteria set by lenders, including credit score, income, and employment stability. Once you determine how much money you need and how much loan you are eligible for, you can explore your options.
You should browse various banks’ Personal Loans and analyse the loan terms. Then, you can consult experienced loan advisors to discuss your options and compare the available loan products.
Banks prefer applicants with an existing relationship and prioritise applications from high-earning professionals and reputable companies on their approved list.
Shortlist lenders who can offer you favourable loan terms. For example, if you have a salary account with ICICI Bank, you can apply for an ICICI Bank Personal Loan to leverage discounted interest rates.
Check if there are any special offers. After you have noted the terms of various Banks, select your lender based on your information. Then negotiate with them to get the best interest rate.
Once you zero in on the loan you want, you can start preparing for the application process. Only apply simultaneously to a few lenders, as numerous credit inquiries can adversely affect your CIBIL Score. Instead, consult your loan advisor and file your application with the most suitable lenders.
Identify the documents needed before applying for the loan, ensure they are valid, and provide clear copies. For example, most lenders require applicants to submit their identification documents and financial statements, supporting proof of income, residence proof, and identity these include copies of salary slips, the latest bank statement, the ration card, passport or driving license, and other relevant documents.
The documents required for a personal loan are standard across most financers, with a few variations as per policy.
An applicant can submit the Personal Loan Application physically or send the documents online. It is essential to take precautions online to ensure the records are not misused. The applicant must fill the form details diligently, giving accurate and updated information the request for a loan is only allowed if the data matches the documentation submitted or as per the verification conducted.
The Financer will process the application further per the steps instated, the CIBIL Score is assessed, and a physical verification is conducted.
The underwriter will review the results and decision on the application.
Once your loan is approved, you should carefully review the loan terms. Being mindful of the terms and conditions can help you manage your loan efficiently without making any errors.
Consult Your Loan Advisors to learn more about the process and simplify your Personal Loan journey!
Lending today is a thriving industry most financial organizations offer funds to customers looking to buy a home, a vehicle, commodities, travel, or for a vacation finance is available as needed. Banks issue various forms of credit in the form of Credit Cards, mortgages, consumer loans, Personal Loans, and Vehicle Loans.
When issuing a Loan, the Lender’s primary concern is to ensure the borrower will repay funds as per the schedule. Delayed repayment can cost the customer and the Lender dearly, which both want to avoid at any cost.
A Personal Loan is readily available to fulfill individual needs and emergencies,but borrowing an amount easily affordable to repay with the current earnings is the right decision.
There are no restrictions on using a Personal Loan, and it can be used by the applicant as desired. Banks issue funds as Personal Loans for personal expenditures without collateral or security with an individual policy for calculating the loan amount and interest rate applied. The Primary features for calculating the loan amount that can be issued to an applicant are as follows.
• The Monthly Income: The salary of the applicant transferred to the Bank account, is counted as the monthly earnings if additional sources of income are coming in regularly, provide documentary proof of the same.
• The Current Employer: The company the applicant works with should feature in the Lender’s company category list the loan amount approved and the interest rate are per the company’s categorization.
• The Existing Loans and Credit card usage, as reflected in the CIBIL, are taken as obligations and deducted from the income. The CIBIL Score of the applicant must be above the required benchmark.
The lender assesses the profile of the applicant and confirms the amount that can be issued as a Personal Loan. After the applicant accepts the terms of the lending organization the loan amount is transferred to the applicant’s account electronically.
When signing the agreement and accepting the terms of the lender, the applicant should pay attention to the terms for the repayment of the funds, paying attention to the monthly installment or EMI, the charges applied, and the total cost of the loan.
Before applying for a Personal Loan, it is essential to check all repayment terms to work out a suitable offer. Significant norms influencing the terms and conditions for a Personal Loan repayment include.
The Loan Amount: The loan amount the Lender approves as a Personal Loan after considering all related inputs, such as the amount applied for and the eligibility as per policy. The applicant should easily afford to repay the loan with the monthly installment fixed.
The Interest Rate: The interest rate or the cost of funds for a Personal Loan is 10.25% to 20%, charged at a monthly reducing balance, and is the primary cost of funds. Surveying the market for the lowest rate available will ease the Repayment.
The Repayment Tenure: for a Personal Loan or the period within which to repay the loan is 12 months to 72 months. The Bank decides the term according to the repayment capacity and profile of the customer. The EMI can vary with the tenure if the applicant desires a lower installment a longer tenure can be requested, whereas if the loan amount can be repaid sooner the applicant can ask for a shorter tenure.
A copy of the agreement signed, with all terms and conditions notified dispatched to the customer as a soft copy, and hard copies are sent through mail/courier services. Also included is a schedule for repayment of the loan Known as the amortization schedule or table, which reflects the amount paid as a monthly installment.The columns of the schedule include the following:
• What is the total number of EMI for the tenure of the loan?
• The installment.
• The break-up of each installment: ratio of the amount paid as the interest and principal amount.
• The total amount paid as interest or the loan cost.
• The remaining monthly balance of the principal Loan amount.
The initial installments include a greater ratio of interest as the loan amortizes, the amount going toward the principal increases and gradually grows monthly.
So factually, the EMI repaid is not equal the Bank first recovers a significant part of the interest and then the principal amount.
Though generally ignored, much is to be gained by keeping track of the loan repayment and loan amount balance with the help of the schedule.
The EMI, as it is popularly known, is the instrument to repay a loan it is deducted electronically from the Bank account of the loan holder on a designated date every month.
Whatever date the applicant receives the money, the EMI schedule begins in the consecutive month. However, applicants receiving funds after the 21st of the month will pay the installment after a month.
For example, for a Personal Loan transferred to an applicant’s Bank on the 23rd of February, the EMI is presented to the account on the 1st of April. A gap interest is charged from the 23rd of February till the 6th of March as an overlap.
It is the responsibility of the applicant to ensure that there are enough funds in the account to clear the EMI if the EMI bounces or is returned unpaid, the same will reflect in the records, with the following repercussions.
• Finance charges as late payment and interest are applied daily until the applicant pays.
• Details of the delayed EMI will always reflect in the repayment account, even if the applicant pays the installment later with the charges.
• The CIBIL history of the applicant will reflect the transactions of the delayed payment downgrading the score.
• Most Banks and financial institutions do not fund further credit to an applicant if there has been an EMI bounce three months before the application date.
Therefore, keeping a tab on the EMI date to ensure enough balance in the account to pay the installment is paramount. For further tips on how to avoid missing your EMI date, please refer to the following:
A Personal Loan is a finance issued for individual usage for short periods. Preferably, the applicant should pay the EMI over the tenure to gain maximum benefits. A Personal Loan tenure with timely repayments is the best method to build a Credit Score.
Repayment of your loan early in the tenure is not advisable, as the interest factor paid as compared to the principal deducted; however, if there is a need to repay the loan, whether partially or entirely at an earlier date, financers will have a policy for the time and finance charges.
• The minimum EMI paid or the lock-in period ranges from 6 months to a year, and a finance charge ranges from 2% to 5 % of the principal balance for the foreclosure of the loan.
• Partial repayment of up to 25% of the principal loan amount is permitted, the amount adjusted in the tenure, and the installment remains unchanged.
The charges applied for a Personal Loan foreclosure make it advisable to complete the tenure. However,an advantage of repaying a loan is the eligibility for borrowing a more considerable sum in the form of a mortgage or consolidating finances.
Individuals requiring funds for a limited period, expecting to receive finance, and planning to repay the loan, should pay attention to the terms for foreclosure and part payment and choose a financer with a flexible prepayment policy.
With widespread education and technology, there are increasing opportunities for qualified youngsters. Top companies offer enhanced salaries to qualified candidates as a start.
Banks and NBFC are ready to invest in individuals holding high-profile jobs with a promising future the term “Loans” is no longer a taboo today, a salaried individual can start planning finances, buying a home, and establishing a good lifestyle.
Be cautious and remember that borrowing is easy, but organizing finances to ensure timely repayment is critical to a successful financial future.
The need for funds comes without asking: whether in an emergency or as a lifestyle requirement for funding wedding celebrations, a holiday, redecorating your home, or paying credit card bills, making an arrangement to fulfill the shortfall is a priority.
Near and dear ones may not have the resources to help now a feasible option to help solve the need is a “Personal Loan“.
Leading banks such as HDFC, ICICI, AXIS, YES BANK, and NBFCs offer loans for individual needs without any security or collateral as a Personal Loan.
Banks have devised the Personal Loan product as a quick loan making it convenient for eligible applicants to get the loan amount within 72 hours. Processing is done based on the customer profile and document proof.
A note of the Eligibility criteria required for successfully processing a Personal Loan is a good idea.
Most Banks, such as ICICI, HDFC, AXIS, and YES Bank, have similar eligibility criteria with certain variations to suit the target segment and policy. However, the essential key points to be adhered to are as follows.
The minimum age required for processing a Personal Loan is 21 years. The maximum age limit allowed by most leading Banks such as HDFC, ICICI, AXIS, and YES Bank is 60 years at the time of loan closure or till the retirement age, which could extend to up to 62 years.
The Customer needs to provide Proof of retirement age extension with the application for processing; not all lenders entertain the extension of age criteria clause, which the Customer should verify before applying.
The HDFC Bank has introduced a unique scheme for pensioners to repay a Personal Loan till the age of 65 years.
Primary education is the right of every Indian citizen, with education comes progress and the ability to create a stable future.
For candidates who have scored well, excellence is the basis for securing admission to a prestigious institution and further employment with a good package.
Financers also consider a primary education mandatory to secure a Personal loan and also offerwell-qualified individuals graduating from Top institutions, like IIT and IIM, and professionals such as Doctors, Dentists, Nurses, and Teachers discounted interest rates and enhanced loan amounts.
The Applicant’s employment status is a critical factor for issuing a Personal Loan for salaried employees. The Employer’s profile is all-important to ensure the stability of the job and regular salary for the Applicant.
The Applicant must be currently working with a:
• Public Ltd Company
• Private Ltd Company
• PSU
• Government Organization.
Employees of Proprietorship or Partnership companies are not eligible to apply.
Most Banks and NBFCs, such as HDFC, ICICI, AXIS, and YES Bank, have generated a company list the Employer must feature in the list of approved companies and the Company must be registered with the MCA or Ministry for corporate affairs and exist for five years or more.
The Applicant must have an employment history of consistent employment for 12 months or more to be eligible for a Personal Loan, submitting Documented Proof of the Employer and the employment history at the time of application.
The minimum income required to process a Personal Loan is 25,000/- as the monthly net amount transferred to the Applicant’s salary account.
Most Banks consider a salary transfer by ECS mandatory; the traditional way of cheque deposit or salary receipt by cash is not acceptable. In addition, the Employer must regularly transfer the salary on a designated date a delayed salary transfer is negative.
Banks fix the salary criteria according to the profile, the employment category, and the relationship with the Applicant. For example, HDFC Bank allows applications from candidates with a salary of 25k per month and a salary account or employed with a company listed in Category A of the company category list. For others, a wage of ₹ 30k is the minimum required.
Similarly, Banks such as ICICI, YES, and Axis Bank have their list of preferred categories to which they offer a concession in the income criteria.
Applicants working with companies that are not listed or included in a lower category will need to establish an income of 40k per month to apply for a Personal Loan, whereas State/ Central Government personnel and candidates working for Economic Times listed organizations have a salary of 25000/- High-income customers with a salary of 75k are regarded as elite applicants by HDFC Bank and awarded the Golden Edge Personal Loan benefits.
Banks and NBFC have a widespread presence in most cities, with a chain of branches and ATMs compared to smaller towns and rural areas.
A Personal Loan is unsecured therefore, the Bank conducts a residence verification to confirm the KYC Details of the Customer. The current residence, whether rented or self-owned, must be physically verified by the Bank channels having a strong presence in the metro cities, an applicant is easily contactable for confirmation.
Therefore, to be eligible, the residence location of the applicant must be included in the approved list of locations for servicing Personal Loans.
The CIBIL or Credit Bureau of India Ltd records the credit transactions of Individuals and maintains updates. Lenders refer to the CIBIL to obtain a credit score and history for all individuals applying for credit. The minimum score required to process a personal is 720 points and above.
A sound repayment track of credit held reassures the Lender that the Customer will repay the EMI as per schedule. In contrast, a poor repayment track with delays and defaults will negate the eligibility for a Personal Loan.
Applying to a Lender with a previous relationship of on-time repayment will enhance the eligibility for a Loan.
HDFC, ICICI, and YES Bank process Personal Loans for first-time loan seekers candidates without a CIBIL Score who can create a good credit history by maintaining an on-time EMI.
A rejection of a request is disheartening besides, the CIBIL Score of the applicant decreases with every credit inquiry. Therefore, checking out the possibility, or as in Banking terms called Eligibility for a Personal Loan, before applying is always a good idea.
At Yourloandvisors.com, we can help our esteemed customers to confirm their eligibility for a Personal Loan and assist them in applying to the Lender that services them best.