A problem can arise at any time and there is no way of knowing how much you will have to be prepared, financially. Taking a personal loan can help you tackle your financial problems very easily. The process of getting your personal loan approved is not an easy task. Since most personal loans are unsecured, the bank needs to know if you will be capable of repaying your debt before they approve your loan. If you want to opt for a secured loan you will have to keep collateral like a house or your gold or fixed deposit.
A lot of things go into the approval of your loan application. The first thing that a bank sees when you apply for a loan is your credit score. If you have a good credit score, your loan will be approved faster. But if you have a low credit score, the process of your loan approval will be a long one.
Other things that are taken into consideration during a loan approval process are your monthly income and expenses and your job profile and status. If everything pans out properly, your loan will be sanctioned within no time. With the changing time, a lot of changes have happened in the process of getting a loan.
Find out about the various types of loan that are available:
1. Loans that are available on mobile applications:
A lot of Non- Banking Financial Companies (NBFCs) have taken the plunge into the tech world and are providing loans on mobile applications or apps. This type of loan is very low in terms of amount and usually is not affected by an individual’s credit history.
This is perfect for people who want to avail a loan but their application gets rejected. People who fall into the age group of 24 to 28 years are usually the ones who apply for this type of loan. There is some documentation that you need to submit before your loan is approved like you Permanent Account Number (PAN) and bank statements.
2. Loans that are pre-approved:
A lot of banks now offer a pre-approved loan that has reduced the approval loan of your loan application by a lot. But this type of loan is not available for all customers. Only if you fit the personal loan eligibility criteria will the bank approve your loan application.
The eligibility is decided by your past transactions and your income. You also need to be an existing customer with the bank for your loan to get approved. You will have to pay some processing fees but the processing fees completely depend on your bank. The interest rates offered by the banks also differ depending upon their policies.
3. Loans that are offered by websites:
There are various online portals that let you compare the loans from various banks. The information provided by these websites is up to date and accurate. They can guide you better in terms of which type of loan you should opt for. Since these websites are not associated with any banks, they can give you an unbiased opinion and guide you better.
Taking a personal loan or any type of loan is a big decision and you need to think properly before taking a loan. The payment of your personal loan will take some time and it will affect your monthly finances.