InvestorQ : How do I check if I am eligible for a personal loan?
divya Sing made post

How do I check if I am eligible for a personal loan?

Manisha Mehta answered.
3 years ago

For a personal loan, a borrower must have some regular source of income. You don’t necessarily need to be a salaried individual. Even a self-employed individual or a freelancer can avail of a personal loan.

Eligibility criteria for a personal loan:

  • The borrower should be in the age bracket of 21-58 years
  • A salaried professional should have been at the current job for at least six months and must hold an experience of minimum two years.
  • In case of a self-employed person, the minimum limit of work experience and the duration of business should be at least 2 or 3 years, or as per the lending institution’s protocols.
  • The individual’s minimum income limit should be Rs. 20,000.

A personal loan has many purposes and using the credit to enjoy your holiday is one of them. The sanction of this loan to salaried individuals and business people requires very less documentation and is released within a matter of minutes or hours with the help of technology, the credit score and your repaying capacity among other criteria. So, availing a personal loan to finance the trip to your dream destinations is very much a viable option.

As is the case with all other loans, your eligibility for a personal loan, too, is affected by your credit history, length of service in your workplace, etc.

While various lenders have their own eligibility criteria, the most important one is that of your credit score.

Credit score

Credit score is a score, between 300 and 900, that is assigned to you based on the your payments towards your credit cards or loans. It is a way to identify your credit worthiness and helps banks or NBFCs decide whether they should lend to you or not. Although it is subjective, but a score above 800 is considered to be good or safe to lend to.

The score is based on the details of your financials and your repayment history gathered from your banks and credit card companies.

In India, there are three credit agencies that help give you your credit score-TransUnion, Experian and Equifax.