Applying for a pre-approved personal loan is one of the best ways to acquire timely financial help. However, before applying, check personal loan eligibility to ascertain your chances. Depending on what the personal loan eligibility check reveals, you can identify a rate of interest and choose a tenure that suits you in every way.
Discussed as follows are steps that enable you to apply for a pre-approved personal loan –
Fill all the fields in the form – Since this is the first step, you need to provide all the personal details, information related to your employment, and financial health. You must also mention contact details and investments and retirement accounts that you might be maintaining. At the bottom of the form, add the loan amount, the purpose of the loan, repayment tenure, and EMI.
Credit check – After submitting the form, lenders check the mentioned information. The intention is to determine how creditworthy you are. Then they decide how much loan amount and interest rate you should be offered. They follow this up with another round of scrutiny wherein they check your financial history.
Approval – Before approving the loan, lenders assess the credit score and the debt you might be carrying. Healthy credit history and minimal debt are ideal conditions for lenders to approve the loan amount. If the lender expresses doubt, you can increase the chances for a pre-approved personal loan by offering collateral or getting a cosigner.
Receiving the amount – Apply for the loan by submitting all the requisite documents and waiting for the lenders to respond.
Differentiating Between a Pre-Qualified and Pre-Approved Personal loan
When you verbally inform the lenders of your financial situation and seek their approval, the loan is pre-qualified. The lender takes an unofficial overview of your income, assets, debt, and other aspects of your financial situation, and then recommends the amount for the loan. Such a loan is suitable for customers who wish to buy a house for the first time because it does not carry any fees. Moreover, it also does not impact your credit score. Hence, it is beneficial for your long-term financial health.
In sharp contrast, a pre-approved personal loan implies that the lender has approved you for receiving a specific loan amount. In this case, also the lender reviews and verifies your financial information and then approves an amount that appears to be most suitable. Since you are aware of the loan amount and financial capability, repayment through EMI is easier and chances of default are minimal.
What are the qualifications for personal loan eligibility?
Tips to enhance your chances of getting a pre-approved loan
Listed as follows are tips that can improve your chances of getting a pre-approved personal loan –
- Ensure that your credit score is above the 750-mark;
- Try to consolidate your debt as much as possible;
- Your existing EMI should not exceed two-thirds of your current income;
- Fulfill all the conditions mentioned under the personal loan eligibility criteria;
- Avoid submitting too many loan applications, especially within 6 months of applying for a loan;
Other tips include being aware of the EMI to be paid and ensuring that there are no pending credit card dues. Distinguishing a secured loan from an unsecured loan can also help while applying.
Lenders offer pre-approved personal loans as an invitation, which is why it is valid only for a specific duration. So how you need to apply for this loan for yourself and for your future, you must be on the lookout and keep all the documents close at hand. Also, conduct the personal loan eligibility check beforehand. Then you need not waste time while filling out the form. As soon as lenders extend the invitation, you must apply within the specified time frame.
There are times when lenders might charge extra processing fees or pre-closure fees in case of a pre-approved personal loan. Make it a point to inquire about these from the lender before going ahead with the application.