When you apply for a personal loan, there are certain requirements from the lender’s side you need to fulfil. Only when you meet these personal loan eligibility criteria, your loan gets approved and you would receive the loan amount in your account. Though many lenders require only basic documents and age and income limits, the criteria may vary from lender to lender. Here, in this brief guide, let’s understand what requirements you need to meet to get a personal loan for your home repairs, medical emergencies, or vacation.
Factors Contributing to Eligibility Criteria for a Personal Loan
When you apply for a personal loan, whether it is to buy a gadget or to cover medical expenses, lenders consider several factors before they approve your loan application. These factors may include your credit score, income, job status, age, debt-to-income ratio, and existing loans. So, let’s take a look at all the significant factors contributing to personal loan eligibility criteria:
Credit Score
A credit score is a three-digit number that reflects your creditworthiness. In other words, it is a number that shows how good you are at repaying debts. This number usually ranges from 300 to 900, and most banks and financial institutions in India prefer a credit score of 700 or higher for personal loans. Hence, it is important to handle your debts well so that you can maintain a good credit score.
Income Requirements
Income always plays a key role in influencing eligibility for personal loans. It is because lenders assess your monthly income to make sure you earn enough money to repay the loan on time. In India, any salaried individual can avail a personal loan. The better the income the more the chances of getting a personal loan approved.
Employment Status
Yes, your job status matters too. When you apply for a personal loan, lenders would always prefer approving loans for those who have a stable job with a well-known company. For salaried individuals, they would require at least 6 months in the current job. If you are self-employed, your business should have been running for at least 2 years.
Age Criteria
Usually, lenders consider applicants, aged between 21 years and 60 years, for personal loans. However, if you are self-employed, the upper limit could be between 60 years to 65 years.
Debt to Income Ratio
You should always calculate your debt-to-income ratio before applying for personal loans. The debt-to-income ratio is the percentage of your monthly income that goes towards repaying debts. With this ratio, lenders check if you can handle more debt. So, a lower debt-to-income ratio is always preferred by lenders.
Existing Liabilities
Existing liabilities are your current loans, credit bills or other financial obligations. These liabilities tell lenders about your loan repayment capabilities. So, if you have high existing liabilities, then it can certainly affect your eligibility for personal loans.
CASHe’s Loan Eligibility
CASHe is one of the leading instant personal loan apps in India offering credit at competitive interest rates and flexible repayment schedules. If you are looking to avail a personal loan with CASHe, then here are certain requirements you need to meet:
- Age: You should be above 21 years of age
- Income: You need to have a monthly income of at least ₹25,000
- Employment: You should have a stable job
- Credit Score: Must have a good credit score, usually above 650, to improve chances of loan approval
- Documents: You need to provide basic documents like your Aadhaar card, PAN card, salary slips and IT returns.
Conclusion
This was all about personal loan eligibility criteria and why it is important to meet them. When applying for a personal loan, make sure to keep a good credit score, have a stable income, and maintain a low debt-to-income ratio. This would help you get your loan approved quickly.
Not having an excellent credit score? Worry not! Download the CASHe app and apply for an instant personal loan. With CASHe, you can avail funds of up to ₹4 lakhs with an easy repayment schedule and good loan terms.
It’s time to pave a path for a successful financial future. Get going today!
