5 Golden Tips To Increase Your Personal Loan Eligibility
Personal loans come as a preferable solution to fund diverse financial requirements. However, since it is an unsecured loan, lenders give more importance to meeting the personal loan eligibility requirements.
They also prefer sanctioning the loan to borrowers who come with high creditworthiness. It is because such borrowers have a strong repayment history, which reduces the chances of default.
However, you can use a few tips to increase your personal loan eligibility, which will increase your chances of loan approval.
5 Tips to Increase Your Eligibility For a Personal Loan -
- Make Sure to Check Your Credit Score Before Applying
The 3-digit credit score is a measure of your ability to repay debts. Lenders consider 750 and above as a considerable score for approving loans.
So, check your score before you apply. If it is low, you must wait. Improve it by repaying your existing bills and debts on time and keeping the credit utilization ratio on your credit card under 30%.
2. Refrain From Making Multiple Loan Applications
Lenders initiate an inquiry about an applicant’s credit history once they receive the application, which impacts the credit score negatively. So, it is best not to make multiple loan applications at the same time.
3. Maintain a Minimum of The 6-Month Gap Between Your Applications
It’s best to apply for a loan after a minimum of 6 months if your previous loan application was rejected. It creates a good impression on the lender, and you are not considered desperate for the credit.
4. Consider Your Debt to Income Ratio
A debt-to-income ratio of less than 50% is considered good as it portrays a high repayment capacity. If you already have debts, make sure to apply for a loan amount whose EMI payment keeps this ratio within the range.
5. Choose a Longer Repayment Tenor
Select a longer repayment tenor as it distributes the loan amount across a higher number of months and reduces the EMI. It increases your repayment capacity, which improves your chances of availing loans. you can check your monthly loan EMI using Loan EMI calculator.
Make sure you use these tips to increase your personal loan eligibility. Then, apply for the loan to get quick approval.
