When multiple financial obligations demand your attention,
it can put a strain on your finances if you don’t have enough savings. In such
situations, personal loans can come in handy by providing you financial aid in
your time of need. However, when you apply for a personal loan, there is no
guarantee that your loan application will get approved. The lender first needs
to ensure that you are eligible for the loan and that you have the financial
capability to repay.
If lenders see either of these things lacking, they may
reject loan applications. Here, we look at key tips to help increase your
chances of getting your loan application approved.
1. Ensure you meet income requirements
Whether you apply for an instant loan via a lender’s loan app or visit them in person, you are required to meet the minimum income requirements. This may or may not be listed on the lender’s website. So, you may have to speak to a customer executive or browse through their terms and conditions to know the minimum income criteria to apply for a personal loan. It is also essential that you apply for a loan commensurate with your repayment capacity.
2. Check your credit score
Your credit score is one of the primary factors on which lenders decide to approve your loan application. A credit score of 750 and above is regarded as healthy. It can give you a higher chance of getting the loan application approved. However, if your credit score is below 750, even though you may still qualify for a loan, it is best to try and improve it. This reduces your chances of an outright rejection based on poor credit score.
3. Meet employment requirement
Lending institutions have specific employment requirements, which hold a crucial role in the loan approval process. Typically, they require you to be in the employment of a company for a minimum number of years and with a steady stream of income. The longer you have been employed, the better. Plus, if it is with the same company, it can hasten the approval of a loan.
4. Pay off outstanding debt
Having an existing loan at the time of applying for a fresh loan can play a critical role in deciding the fate of your new loan application. Accumulating too many loans can hurt your chances of getting a fresh loan as lenders may doubt your ability to repay. Your debt-to-income (DTI) ratio can help you determine how much you can afford to borrow. If your DTI is more than 40%, it is wise to repay the outstanding debt before you apply for a new loan.
5. Maintain a regular payment history
Long payment history shows you can make repayments on time and that you are financially responsible. Conversely, if you have late payments or defaults, it could reflect poorly on your profile and discourage lenders in approving your loan application.
If you require financial
assistance, you can apply for a personal loan through Bajaj Finserv Personal Loan App. The instant
loan app offers high-value loans of up to Rs.25 lakh with a flexible repayment
schedule of up to 60 months. Once you are eligible, your loan application gets
processed quickly and the money disbursed to your account within twenty-four
hours. The app also provides you with the option to apply for a pre-approved
offer on your personal loan.
