What Factors do the Lenders Check before Extending Personal Loans?
By Anupama Deshpande | Dec 12, 2018

Any person who is above 21 years but less than 60 years old having a regular income gets a privilege to avail a Personal Loan very easily. In order to get a personal loan banks want you to submit minimal documents and the important feature is that there is no need to tell the reason to the banks as to why are you availing the personal loan.

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Some of the banks require some minimum criteria of your income and some of the banks also want you to have some minimum years of experience to opt for a personal loan.

If you want to apply for a Personal Loan then you must know beforehand as to what factors do the lenders check before extending personal loans?

Outlined below are the important factors that banks or lenders consider before approving a personal loan application:

You must have a regular income no matter you are salaried or self-employed. Sometimes there is also some minimum income criteria imposed by banks for extending personal loan such as you should earn Rs 3 lakhs per annum to apply for a personal loan. You must be aware of this factor.

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Lenders also pay attention towards the employment status that you have. Whether you are salaried or self-employed? If you are salaried then they will check:

• For how long are you working?
• Who is your employer?
• Since when you are working with your existing employer?

Lenders also check your repayment history of your past as well as your existing loans. They also check if you have made any default or delay in making your payments in time.

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For getting your instant Personal Loan approval you should be having credit score should be above 750. Credit score of 750 is considered as a decent credit score and you will easily get the loan because it indicates that you have a very good loan repayment history.

Lenders calculate the proportion of your existing loans to your salary during the loan approval process. Your chances of getting loan are less when your total EMIs exceed your monthly salary by 40%.