A personal loan being an unsecured loan is mostly based on the salary of an individual and the credit score he or she has is what helps the lenders to judge whether he or she is creditworthy of a personal loan. Further, the amount of credit approved for personal loans also depends on one’s salary and his creditworthy nature.
The Axis bank personal loan scheme starts from an average salary range of INR 15,000 to INR 20,000 and the loan amount that one is sanctioned is between a range of INR 50,000 to INR 25,00,000 which depends on one’s borrowing and repaying capability. As a personal loan is an unsecured loan and there is no security value like there is in the case of gold loans thus a lender checks one’s salary slip and credit score (which is most suitable with a score of 800) for a guarantee of repayment. More than that, there is no certainty as to how much loan will be sanctioned when you apply for your personal loan as it mostly depends from one financial institution to another.
In this next part we will be discussing some factors which help you to get a healthy loan policy:
- Eligibility age- The eligibility age for a personal loan has been set between 23 to 60 years which has to be maintained to get a loan sanctioned. The reasoning behind this is the older we grow our capacity of earning reduces as with age our working capacity decreases. Thus lenders prefer young borrowers as they are in their youth and have the capacity to work extra hard to pay off a loan.
- Having a savings account- Having an existing savings account could prove to be beneficial while applying for a personal loan. It acts as assistance for the lenders who can get to see the credits and debits in one’s bank account. Further, if an individual takes a personal loan from the same bank where he/ she already has a pre-existing account then it could prove to be beneficial in many ways, like getting a pre-approved personal loan. The reason behind it is that pre-approved loans have no documentation and money is transacted within a matter of a few minutes, thus providing the enhanced facility.
- Having a past credit card history- The credit history of an individual is essential as it acts as a security for the lenders. They can check the credit history of the borrower and get to know if he or she is worthy of the credit or not. Lenders generally ask for credit card history details so as to minimize risk factors as they do not consider people who have previously defaulted on any other loan. Having a clean credit history serves as a bonus.
- Having higher repayment capacity- Lenders are always looking for borrowers with low existing EMIs so that the risk is low during repayment of loans. Lenders also look for Income Debt ratio for this purpose as they search for a maximum of 40% of one’s income as a total contribution towards debt.
- Stability in employment- As we know that personal loans are granted on the basis of one’s salary or stipend of a minimum of INR 15,000 to INR 20,000. An individual not being able to maintain a stable job opportunity would not be considered eligible for the approval of a personal loan.
One must be having enough knowledge and should match the eligibility criteria before applying for a personal loan. Moreover, the above-mentioned information must help you while you or your dear one take a personal loan.
Must read:- Personal loans over others
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