Top 4 Ways to Boost Your Chances of Getting a Personal Loan
A form of unsecured lending, personal loan gives you access to substantial funds that you can use to finance all your needs without any limitations or restrictions. So, whether you want to bolster your finances to meet financial goals like an overseas vacation or a home renovation project or monetary assistance to meet a sudden cash crunch, an instant personal loan will help you access cash easily and speedily.
To avail convenient financial solution, your personal loan application needs to get a green signal from your financier. Wondering how to get a personal loan approved in a hassle-free manner? Here are four ways you can count on to boost your chances of getting a personal loan.
1) Improve Your Credit Score
Your credit score is a 3-digit number that aggregates your credibility and repayment history. Your CIBIL score is the range of 300 to 900 based on your past credit behaviour. A low score shows you in a bad light and indicates that you either have unpaid dues or have no credit history. A high score, on the other hand, shows you have been responsible with credit in the past and will fetch you a sanction easily and at affordable terms. So, repay your credit card bills and EMIs on time to aim for a credit score of around 750.
2) Make Loan Applications Judiciously
When on the lookout for a personal loan online, apply carefully and analyse your options beforehand. Do not run helter-skelter to every issuer and make multiple online and offline applications. Every time you make an application, your lender will make an enquiry about your credit score and/or report. Every hard enquiry lowers your credit score by a little and making too many inquiries within a short time frame can adversely affect your score. So, choose the right lender and loan and make just one application when you are sure you meet all the eligibility criteria.
3) Keep your Debt-to-Income Ratio Reasonable
The amount you use to pay off your debts every month in comparison to your total income accounts for your debt-to-income ratio. Lenders prefer a high ratio as this makes them sure about your repayment capacity. With a low ratio, lenders will be more willing to offer you a loan as chances are that you will be able to repay EMIs on time. A ratio of about 30% is considered healthy. Your debt-to-income ratio directly impacts the loan amount you are eligible for as well, since the higher the loan amount, the higher are the resulting EMIs.
4) Consider Joint Loan Application
To assure the lender of timely repayment, you can resort to taking a joint loan. This will be advantageous for you in two ways. Firstly, since two people are involved, your combined income lowers the debt-to-income ratio and thereby assures the financier of your repayment abilities. Secondly, with the debt-to-income ratio staying moderate, you have a better chance of securing to get a low interest rate on personal loan along with larger loan amount.
Finally, to make sure that you obtain finances quickly and in an affordable manner, choose your lender wisely. When you opt for a personal loan online the money is disbursed to your bank within 24 hours of your loan approval. You can also enjoy repayment convenience with this loan. This is because the interest rates are affordable, the tenors are flexible and span across 12 to 60 months, and you benefit from features like flexi loan facility.
The flexi loan feature allows you to borrow repeatedly, in part, from your sanction without needing to make new loan applications. Here interest is charged only on the amount you use and not your entire sanction. Also, you can make part-prepayments on your loan and redraw from the repaid amount as many times as you want. Moreover, you can reduce your EMIs by up to 45% by choosing to pay interest-only EMIs. When you take this path, you pay the principal only at the end of your term.
Looking to get started quickly? Check your pre-approved personal loan offer to begin. By sharing a few basic details you will obtain instant personal loan approval, and gain access to other customised financial solutions like insurances and credit cards too.
This article does not necessarily reflect the opinions of the editors or management of EconoTimes.