Many people don’t apply for a loan because they don’t want to be involved in a debt payment for a long time. It majorly happens with people who are employed and are thinking of availing loan facility for the first time.
But, if you are applying for a personal loan for the first time, you can manage it easily after following some tips. A personal loan is an easy source of money that can give you up to Rs.25 lakh to fund your multiple needs without many formalities. Read on to know more!
Vital things to be considered for first-time personal loan borrower
- CIBIL Score
The first thing that you should consider before applying for a personal loan online is your CIBIL Score. A Credit Score is a three digit number between 300 and 900 that showcases how well or poorly you have managed your past repayments. Personal loans are unsecured and hence are provided as per the basis of creditworthiness. Hence, you need to see if you have a robust CIBIL Score or not. Anything above 750+ is considered a better score for the loan approval at a lower interest rate. You can maintain a better CIBIL Score by paying your current loan EMIs and credit card outstanding on time.
- The personal loan eligibility criteria
Most banks and lenders have their own set of personal loan eligibility criteria that you need to meet for the loan approval. Hence, you should ensure that you have the required personal loan eligibility criteria to get the loan without issues. Also, you should furnish the personal loan documents as per your lender’s policies. You can also use the personal loan eligibility calculator to know a loan amount that will be approved as per your income. The tool is available free of cost at a lender’s website.
- Your age
How old are you also impacts your personal loan approval as younger applicants get the loan approval easily! It is because they have more working years left. As a result, lenders don’t see them as a risk in the loan repayment. Even if the personal loan application is approved for aged people, they may get it at a higher rate of interest.
- Your employment stability
You should not switch your jobs frequently if you want to get the personal loan approval as lenders consider such people risks. People who are hopping jobs may not repay the loan as they are not consistent in their jobs. As a result, their income may also get impacted leading to loan defaults. Thus, a first-time loan borrower should ensure a work experience of at least 1-3 years.
You are now well-versed of some considerations that you need to make if you are looking to apply for a personal loan for the first-time. Following such tips will make your loan application easy and fast.
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