Personal loans are a highly preferred financial solution which allows the individual to borrow money from their preferred financial institutions or banks. A personal loan comes with no spending limitation or restrictions just like we see in other loans. These loans can be used for various purposes like home renovation, medical emergency issues, weddings or grand celebrations at home, money crises etc. However, the lender first checks for the credit score and the income source of the borrower. Not everybody is eligible to take a loan from their preferred bank or financial institution. You should check the eligibility for the loan or you can enquire for anything you want. Suppose you want a Personal loan in Kolkata, then you have to visit the nearest lender or banking institution in Kolkata or explore the web for online assistance.
Salary and income matter the most as banks will check the details of your balance in your account and check whether you are employed somewhere or not. It becomes very important to make sure that you can pay your debts on time.
Income affects a lot of Personal loans and helps to get a loan in a few working days. Let’s read all the steps carefully:
Income/Employment is Necessary for Taking Personal Loan
While determining your personal loan eligibility, income source and smooth stability of employment are very significant. Your bank or financial institution will check for the repayment capacity which helps them to grant you loans as soon as possible. On average, salaries persons are considered genuine for loans and their profiles are shortlisted for granting loans. They get good credit scores too from their banks because the lenders of RBI-approved bureaus know that salaried individuals can pay the loan on or around the salary date. The requirement or regularly monthly salary differs from one bank to another. Some provide loans at 30K while some offer it at 25K. There are certain factors on which these banks and lenders provide Personal loans to individuals.
Relaxations for Self-Employed Personnel
Self-employed individuals also get personal loans at profitable deals. Banks and financial institutions know that self-employed people have a steady flow of regular income just because they have business sources. If you are a self-employed personnel, then you need to submit some documents like Income Tax returns, Salary Slips, Statement of Bank and other types of income documents. Your bank and lenders will verify your income and source of employment or business.
Other Things Affects Personal Loan
Credit Score
One of the most necessary thing to check for personal loan is Credit score. A person should have a good credit score, more likely around 750 or above. If the borrower shows that he/she has a credit score in positive numbers with a healthy relationship and better creditworthiness, will be eligible for taking a loan.
Age
Age also becomes a major factor in taking a loan from the lender. The age criteria differ from one bank or lender to another. Some give Personal loans to a person of 25 years, while some provide personal loans at 28. You can contact your lender or financial institution to know at which age you can take a personal loan to meet your expenses and urgent cases. You can search for the age eligibility criteria on the web with your location. For instance: if you want a personal loan in Kolkata, input the same keyword and you will get your answer shortly.
Loan Amount and Tenure
The next thing you need to check is the loan tenure and the amount of the loan you are getting from your lender. You can explore on the web for confirmation. Loan amount and tenure may differ from one banking institution to another. For instance, ICICI bank provides tenue of 1-5 years, while others provide 1-4 years. In a personal loan, you will get a higher rate of interest which you need to repay in a specific tenure.
Check Debt to Income Ratio (DTI)
One of the most important factors to check before taking a loan for your expenses or any medical emergency is the debt-to-income ratio (DTI). It’s the ratio of your payments related to monthly debts to the income you earn in a month. If there is a high DT, it means you have to face several financial obligations as compared to your income. It directly affects your eligibility for taking a personal loan.
Summary
Personal loans are available to individuals or groups to meet uncertain expenses like medical emergencies, home renovation, debt consolidation, marriage expenses etc. Income and employment status matter the most as you can only get a Personal loan if you are a regular salaried employee in a good company or have a business from where you are getting good earnings.
