How to Acquire a Personal Loan? Explained in 5 Simple Steps

Are you planning for a big fat Indian wedding? Or are you planning to trip across the country to get a break from your hectic work schedule? A personal loan is always there to accompany you as a financial friend. It comes with flexible tenure and is available without collateral. 


Check out these five simple steps if you are looking for some financial assistance.


1. Check your Credit Report


The very first step towards getting a personal loan is to look into your credit report. A credit report contains the details about your existing debts, the number of loans taken in the past, previous defaults, and the EMI repayment pattern. Simply put, it assists lenders in determining whether or not you have the ability to repay your loan on schedule. If you have a poor repayment record, the lender will reject your application.


Some of the common tips to improve your credit report are outlined below. 


  • The first suggestion is never to rely on a credit card to meet your lavish needs. To avoid messing up your credit report or credit score, never use your credit card for more than 30% of the available limit. 


  • Another tip is to compare your monthly obligation with your gross monthly income. If the difference amount is much lower than your expectations, you should first attempt to minimise your debt burden.


  • First, be sure if the credit report that you saw online is free from errors. Contact your lender and ask them to send the error report to the credit bureaus. Contact your lender and ask them to send the error report to the credit bureaus in case of discrepancy.


2. Review and Compare the Interest Rate Offered By Various Lenders


Before finalising your lending institution for a personal loan, a comparison of lenders is highly recommended. Given the tough competition in the market, every financial institution has something unique to offer. As a result, the comparison stage should not be skipped. If you’re not sure where to find information on each financial institution’s personal loan product, visit one of the many loan aggregator websites available online. 


Use a personal loan EMI calculator to understand the interest component in a detailed manner. It is an online tool that will not only assist in comparing various lenders. But it will also help in determining how much EMI is within your budget. 

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3. Look for Pre-Approved Personal Loan Offers


Pre-approved personal loans are usually offered to existing lenders. It is offered to those borrowers who have a strong credit score and a clear track record of EMI payments. The benefit of applying for this loan is you will hardly have to produce any documents before the lender. Since the details and documents are already saved in the lender’s database, the processing is much faster. 


However, before you go ahead with such a loan, don’t forget to check if the lender has any hidden clauses in the agreement. It is also recommended that you calculate the EMI beforehand using a personal loan EMI calculator. 


4. Review Qualifying Criteria 


Check the lender’s qualifying conditions if you want to get approved for a personal loan without any difficulty. Apply if you only fit within the minimum criteria. The following are some of the most common pointers that illustrate most lenders’ qualifying standards.


  • Age: The loan is available to Indian citizens aged between 21 and 58 years.


  • Occupation: The best part about this loan is that you can apply for it regardless of whether you are working or self-employed.


  • Minimum Income: The loan does not require you to have a high salary. If you are earning at least Rs. 15,000 in a month, you can apply for this loan.


  • Minimum Experience: To get this loan, you must need a minimum experience of 6 months in your current job. However, if you are self-employed, 2 years of minimum business experience is mandatory.


5. Submit Application:


Persnal loan lenders allow customers with an option to apply through their official website or by visiting their branch in person. If you need instant approval but are unable to visit the lender due to the work commitment, an online application method is perfect for you. 


To Conclude:


Obtaining a personal loan is not difficult; simply follow the five simple steps outlined above, and the funds will be credited to your account within a few hours.

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