Personal loans are unsecured loans provided by banking institutions that help you meet financial requirements and manage uncertainties in life. Today, people apply for a personal loan to pursue higher studies, weddings, and covering medical expenses. As per the statistics furnished by the Reserve of India, the overall amount of money borrowed in the form of personal loans has escalated for the past few years.
If you are thinking about applying for a personal loan, the initial question that pops-up in your mind would be how much will you be eligible for. Apart from that, there are certain other factors to be taken into consideration like eligibility criteria. It varies for salaried and self-employed individuals.
- The applicant should be a permanent employee of a private or public company with an estimated turnover according to company norms and guidelines.
- Applicants should fall under the age limit between 21 and 60.
- Minimum monthly income should be 13,500 or more
- A self-employed individual does have the option to apply for a personal loan after determining the net profit after-tax based on a particular field. He/she should be active in business for five years.
- The applicant must have at least one year of experience and six months in the existing company.
Method of Checking Eligibility for a Personal Loan
Lenders would consider only those applicants who have successfully met the above-mentioned criteria. However, a maximum threshold to borrow money is pre-set based on criteria defined by lenders. It is highly recommended to focus on factors that would enhance the chances of the loan being approved. Loan eligibility is determined based on factors like age, monthly income, financial capacity of an individual.
You may even take advantage of the personal loan eligibility calculator, which is a magical tool that considers your monthly income, savings, and daily expenses. It fetches the results and you will be informed on how much loan amount you can borrow from a lender. First, you have to input the current location followed by your age and date of birth. Moreover, you are supposed to enter details of EMI’s that contain credit card bills and loans.
You will receive a tentative amount of loan he/she is eligible for. There are also options to modify the rate of interest and tenure based on an individual’s requirements.
- Multiplier Method:- It is one of the popular methods utilized by financial institutions to determine personal loan eligibility. The higher the income and better the reputation of a firm, the higher will be the multiplier and the higher will be the chances of availing of the loan amount at a lower rate of interest. For instance, if you are confused regarding how much personal loan you will be eligible with a net salary of Rs.30,000. Check your loan eligibility here: https://moneyview.in/apply-loan/signup
- Fixed Obligation Income Ratio:-
It is a method wherein the capacity of an individual to pay installment without a default is determined. In the majority of the circumstances, lenders would take into consideration net income as installments. If in case, expenses surpass the percentage of net income, banks would consider maximizing loan tenure or lower the sanctioned amount.
It is crucial to determine your requirements carefully before applying for a personal loan. Make sure that you are well aware of the rules and regulations and ensure installments are paid on time without default. This would ensure robust financial health.