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June 12, 2025
Personal Loan Request Decline Reason: The customer is overleveraged (does not meet the eligibility criteria of the Bank). Here is a comprehensive explanation of how we assisted him in obtaining the required loan amount after the Bank had declined the request.
The Customer’s Predicament: Nitesh Sharma, a young professional with a management degree, is employed in the insurance sector. He applied for an HDFC Bank Personal Loan of ₹3 lakhs, as he was falling short of funds for his wedding expenses, the date was approaching, and arrangements needed to be made. He was confident of getting the amount as his CIBIL Score was above the acceptable benchmark.
Therefore, it came as a surprise to him when his application was declined as being ‘overleveraged”. A customer is considered overleveraged if the Bank believes that the applicant, with their existing obligations, will be unable to afford further credit.
Steps to a Solution: Nitesh reached out to us by completing the Personal Loan Request form on our website. When our loan advisor contacted him for clarification, he was forthcoming about the issue he had encountered.
Listed below are the profile details of Nitesh Sharma that are considered for a personal process.
Calculating Eligibility: Most banks employ the FOIR (Fixed Obligation against Income Ratio) method to determine loan eligibility. Based on the income and the company category listed in CAT B as per the HDFC Bank Company Category List, he is eligible to allocate 50% of his income towards credit dues.
As of the current status, he was paying an EMI of ₹ 25,093, which was declared insufficient for an additional loan amount. Therefore, his HDFC Bank Personal Loan Application was declined.
The Answer: According to his profile specifications, he is eligible to Apply for a Personal Loan. He shared the necessary Personal Loan Documentation with us, which includes the KYC and income documents. The documents were all in order, and upon reviewing the bank statement to match the incoming and outgoing payments, we noted that he was paying an EMI for a home loan.
Finding a way to assist him in securing the necessary funds was urgent because he had already earmarked them for the forthcoming celebrations. We reviewed the specifics and inquired about the details of his credit and found the answer.
A home loan is always granted with a co-applicant, and in Nitesh’s case, this was his father. Furthermore, according to policy, if the co-applicant is an earning member, half of the EMI for a home loan is allocated to them.
We requested that he submit his father’s KYC and bank statement, and we subsequently submitted his Personal Loan Application to ICICI Bank, along with the necessary documents for processing. After allocating 50% of the Home Loan EMI to his father’s account (₹ 12546.5), he is now Eligible for a Personal Loan based on the following eligibility calculation.
Thus, following the submission of his father’s proof of documentation, his Eligibility for a Personal Loan was established, and he was granted a Personal Loan of ₹ 3 lakhs from ICICI Bank. He had calculated the applicable EMI in advance using our EMI Calculator and was satisfied that the EMI would be easily affordable.
Nitesh was relieved that he had managed to acquire the necessary funds on time, and assisting our customers in obtaining their desired funds is the goal we strive to achieve.
In conclusion, when a loan seeker contacts us, our first step is to understand the customer’s profile, their requirements, and their credit history. In contrast, banks assess the case based on the available documentation and the applicant’s data.
We strive to find ways for customers to obtain the necessary funds to address emergencies or immediate needs. The satisfaction of helping applicants meet their financial obligations is immense. Our years of experience and in-depth understanding of the Personal Loan Process provide a valuable asset to our customers, enabling us to offer innovative solutions that consistently exceed expectations.
