Personal Loan Eligibility Criteria
Personal Loans are an unsecured form of multipurpose credit, which may be used to cover a number of personal expenses. You can acquire a personal loan by qualifying with preset eligibility criteria, which are minimal. The basic eligibility criteria are as follows.
Age
Your age becomes an important criterion as a measure of your ability to repay a Personal Loan. As a rule, you will not be denied a loan if you are a salaried person aged between 21 to 58 years. On the other hand, if you are a self-employed professional, your age must be between 25 to 65 years.
Employment
Your term or period of employment becomes a measure of your reliability to repay a loan in time. Personal loans for salaried employees' criterion dictates that you must be working for an MNC or a Private or Public Limited Company with a minimum work experience of 2 to 3 years. Likewise, self-employed professionals must have a minimum of 3 years of experience for personal loan eligibility.
Income
The minimum salary required for a personal loan as an income criterion for eligibility differs from lender to lender. Your personal loan minimum salary starts from Rs. 20,000 per month.
Credit Score
Lenders assess your creditworthiness or ability to repay a personal loan by accessing your credit score, which derives from your credit history in your credit report. Your credit score affects the loan amount, period of credit, interest rate, and terms that you are offered.
Factors That Affect Personal Loan Eligibility
Income
Your bank loan eligibility depends heavily on your income. Higher the income, higher are chances of you getting a Personal Loan at low interest rate.
Credit and Repayment History
Banks and NBFCs at all times consider the credit profile of a borrower before sanctioning a loan. Lenders may reject your loan application, or charge you a higher rate of interest if your repayment history shows that you have not been good at repaying credit. A good credit score helps to increase your chances of loan approval.
Banking Relationship
A good banking relationship helps in loan approvals. If you have a salary account or a savings account with the lending bank, the chances of loan approval are higher, and the terms and conditions offered along with the interest rate are favourable as well.
Ability to Negotiate
Personal loan eligibility factors such as income, credit history, and a strong banking relationship ensure good scope for negotiating better terms and conditions, better interest rates, and better loan tenures for your borrowings. Special offers are part of your package if you negotiate well.
What's the Personal Loan Eligibility for Salaried Employees?
If you are a salaried employee, you can avail a Personal Loan if you fulfil the following eligibility criteria.
- You should be a Resident Citizen of India
- Your age should be between 21 to 68 years
- You should be an employee of a Private Limited Company, Public
Limited Company, or an MNC, or Government Sector which may be a
Public Sector Undertaking, or a Central or Local Body - Your work experience should be from 1 to 3 years and above
- Your minimum Credit Score should be 750
- Your salary should be Rs. 15,000 for a Non-Metro City, and Rs 20,000
for a Metro City
How do you qualify for a Personal Loan?
The eligibility criteria for a personal loan are quite simple, and your qualification depends on the following criteria.
- You must be a Resident Citizen of India
- Your age must be between 21 to 68 years
- You must be an employee of a Private Limited Company, Public Limited
Company, or an MNC if you are a salaried employee. If you are a
self-employed person, or a professional, you too are eligible to
apply for a personal loan. - You should have a minimum Credit Score of 750
- Your KYC Documents should be in order
- You should have an Employee ID Card
- Must be able to provide last 3 Months Salary Slips
- You should have 3 months’ Salary Bank Account Statement
