All of us would have had that moment in our life when money is not sufficient enough to either for buying a home, going for a vacation, buying some gadgets, for marriage expenses or for education fees. And many of us have declined the option of loan thinking it is very time consuming and long process. But in India, getting a loan for any of these needs is not a tough task. Almost all banks are offering loans to applicants if they meet the eligibility criteria, hold good CIBIL score and has the capacity to repay the loan. Here are some of the tips that can help you to get a loan approved in a hassle free manner.
Credit Score is one of the very first checks every bank will check before letting an applicant know if are eligible for a loan. Based on this scoring banks will decide up to what amount can be given as loan and the rate of interest. This is the base scale used by all banks to understand the credit worthiness of a person and the ability to repay the loan with interest. Thus firstly check if you have credit scoring at least above 700 and make sure you do not default or delay any loan or credit card payments. These will directly affect the credit rating and banks will have visibility to the same. Keep a track on your CIBIL score, the ideal number is 800 or above and it is considered best for any loan approval or financial benefits.
Find the Right Lender
Loan charges and eligibility criteria is different for different lenders, similarly their interest rates and other charges will differ. Compare these between different banks to check which one will best suit your needs and even if you can save a penny on an EMI, try doing it. This is where websites such as Finance Buddha will come to help, which will give clear information about the requirements of different banks and what is offered to the borrower. Based on these information pick a bank that looks right for your needs.
Keep all Documents Ready
Before applying for a loan with any bank check for its documentation requirements and keep it ready. It is advisable to have the original document along with copies of the same. Banks will use the original documents for verification and will retain copies for proof. Having all documents handy will help in getting loan processed and approved faster. There are banks such as HDFC and Citibank which will approve loan the very next day if all documents are furnished on the same day of applying loan.
Calculate Affordability
Apply for a loan amount that is with your limit to repay. If you apply for a loan amount for which the EMI is more than 50% of your salary, banks will reject it at the first phase. Also always calculate your repayment capacity based on your regular income. Lot of websites are offering online loan eligibility calculators to help applicants to check up to what amount of loan can they afford with their income. This is the best approach to know your eligibility and will also avoid loan rejections. Loan rejections are another reason for drop in CIBIL scoring. Get
Be Patient
Last and most importantly every applicant should have patience to investigate and apply with the right lender. This will not just help in getting loan approved faster, but will save a lot of time and efforts. Applying for loan at too many places will be recorded in CIBIL ratings and comments; this will give a picture to lenders that you are in a financial trap. Based on which they will avoid offering loan. Banks will consider the request as risky and the chances of getting loan approved will be very minimal.
Whether it is for a personal loan, business loan, property loan or vehicle loan, certain common requirements at all banks for applying for a loan is age eligibility, ability to repay principal plus interest and good CIBIL scoring. You would be getting a plethora of SMS and emails from banks and NBFCs asking for a loan, but these are certain things to be kept in mind for smooth processing before nodding a ‘Yes’.
Focus on these 5 simple tips to present yourself as a credit worthy borrower. Back it up with proper documentations and credit score. Banks will be comfortable to lend money at low interest rates as per your needs.