According to the latest report published by the World Bank in 2016, internet users have increased to 37% of the overall population. Internet penetration is also becoming essential to the financial sector. The need for online loans is rising to meet the growing requirements of online consumers. The Covid pandemic also significantly impacts people getting things done online. Getting a quick personal loan is more than just filling out an application and hoping for the best.
If you want an online loan with better options, you need to do your homework to check out the different lenders and make the right choice. Whenever you need cash, you are likely to feel that your life is about to end. The solution is quite simple. Get a quick personal loan. It is the best way of getting the money we need without undergoing a great deal of hassle. Here are some ways you can get a quick personal loan.
Online Personal Loans
Personal loans have made the lives of many people easy and convenient. These days, most people are leading a hectic life, and they cannot meet their expenses because of their low income. To fulfil their financial needs, people often turn to personal loans.
Personal loans are unsecured loans that help you to overcome your financial crisis. You can get a loan quickly with minimum documentation and without any collateral. As many banks and NBFCs are now promoting online loans, getting a loan has become more accessible. But before applying for a loan, you should be aware of the required eligibility, terms, and conditions of the lender from whom you plan to get a loan.
Eligibility Factors For Online Personal Loan
Depending on banks and lending companies, eligibility to get a quick personal loan may differ. Still, there are some specific criteria universally followed.
The applicant must
- Hold Indian citizenship.
- Be above 21 years old when applying for the loan.
- Monthly income of the applicant should be Rs.18,000.
- The applicant must have completed a minimum of two years in their current organisation for salaried people.
- For self-employed, the applicant must have been in their business for a minimum of two years.
The applicant should have a credit score above 700.
Required Documents for Online Personal Loan
For Salaried People
Duly filled application
Any Identity Proof – PAN / Aadhaar / Voters ID / Passport / Driving Licence
Address Proof – Postpaid or Landline Bill / Utility Bills / Voter ID
Past three months’ bank statements.
Payslip for the last three months.
Last three years’ Income Tax Returns
For Self-employed People
Duly filled application form
Proof of Identity – PAN / Aadhaar / Voters ID / Passport / Driving Licence.
Proof of Address – Postpaid or Landline Bill / Utility Bills / Voter ID.
Last three months’ bank statements.
Payslips for the last three months.
Past three years Income Tax Returns with computations.
CA audited the last three years’ Balance sheet and Profit & Loss statements.
Also Read: How Can You Get a Quick and Easy Instant Loan Without Documents
Advantages of Personal Loan
If you have a good credit score, a Personal Loan is an advantage.
- Low-interest rates -: Compared with credit cards and credit card loans, the interest rates are lower for personal loans. Mainly, it works well for a higher amount.
- Variety of uses -: You can utilise the fund for any purpose. Be it a vacation, to pay off debts, education fees, holiday, wedding, etc. You can proceed with a personal loan.
- Consolidated debt -: Paying off your existing loans and bills is one of the most intelligent decisions to use a personal loan. With a low-interest personal loan, you can clear your credit card bills and other loans with high-interest rates. Thus, it will save you from paying more interest.
- Create an emergency fund -: Whenever you are in an emergency, by getting a quick personal loan, you can arrange funds to cover your needs.
- Ease of repayment -: While applying for the loan, you can opt for the repayment tenure from 6 months to 5 years.
- Improve credit score -: You can improve your credit score by paying off the dues and EMIs. Using various credits makes it possible to exhibit that you are credit responsible and have a good repayment history. These are the criteria that lenders look upon to approve your loan application. So it will be easier for you to obtain loans in the future.
Knowing your credit score is essential while applying for loans and credit cards. Use Buddy Score and check your credit score.
Tips to Get a Personal Loan Quickly
When you apply for a personal loan, you can use these tips to avoid any delay in the approval.
Apply Online
It is the fastest and most secure way to obtain a personal loan. You can go online through a mobile application or the official website of the authorised lender or bank. You can apply once you provide all information and upload all the documents. Lenders have the right to accept or reject your application after the verification process. The best part is you can get each update through your emails or messages. Once KYC verification is finished, your loan will be approved, and the amount will be disbursed to your account within 24 – 48 hours. You can even check with your bank for any current offers because many banks provide pre-approved and pre-qualified loans to their customers based on their relationship with the bank and credit history. You can avail an instant personal loan through Buddy Loan with interest rates starting from 11.99%.
Maintain a Good Credit Score
A credit score is a three-digit numeric value that shows your creditworthiness to the lenders. It helps the bank or lenders to determine your credit behaviour and repayment capacity. A credit score above 700 is considered a good one, and if it is above 750, it is beneficial to get speedy loan approval. With a good credit score, you are regarded as less risky by the lenders, and you have a low chance of defaulting on your payments in the future.
A credit score is a factor that helps you to get better interest rates and lower processing fees. So, maintaining your credit score is very vital. You have to keep a healthy practice of paying off your dues and EMIs on time. You can set up a reminder for your payments or enable the auto-pay option in your registered bank account. But always maintain enough balance in your bank account to avoid any bounces.
Check your credit score before Applying
Always check your credit score before applying for a loan to ensure you don’t have any defaults. There might be chances for any missed out dues or EMIs. If your credit report has some errors, it directly affects your score and leads to rejection of the loan. So checking your credit score before applying for a loan will save you in many ways.
Maintain a good bank balance
Lenders will check how you maintain your average monthly balance because it shows your repayment capacity. If you have a higher average balance in your savings account, you can easily avail hassle-free pre-approved and pre-qualified loans. You can get instant disbursements in these types of loans. However, before falling for any offers, read all the documents thoroughly and review the terms and conditions, various charges, and lender’s reliability very well so that you can help yourself from any fraud actions.
Apply only with one lender
When you are in an emergency and need cash immediately, you might get a quick personal loan with multiple banks and NBFCs by thinking you may get it soon from any of them. But this method is invalid as a hard inquiry by lenders will be followed for each loan application to check the applicant’s creditworthiness. So when you have multiple applications, you have numerous hard queries. It will create a significant decline in your credit score. Eventually, a low credit score can be risky for loan approval.
Keep all the documents ready
Before applying, ensure you have all the required documents mentioned by lenders or banks. As an unsecured loan, it doesn’t need more papers, but it’s better to cross-check again to avoid any troubles. Keeping documents ready will save your application processing time.
Provide accurate information
To increase the chance of a smooth and hassle-free loan approval process, you must provide accurate information. For example, if you have more than one income source, you must also provide secondary income proof. If you are living in a rented house, you have to offer a rental agreement along with your permanent address proof.
Apply for what you can manage to pay
You should consider your debt-to-income ratio while applying for a loan. Generally, the debt-to-income ratio shows a ratio of your monthly EMIs and your monthly income. You are not supposed to take a higher loan than your repayment capacity. It will create an imbalance in your debt-to-income ratio, which will lead to the rejection of loan applications. You should maintain a debt-to-income ratio of less than 30%. It means most of your monthly salary should not be used for paying off your debts. For example, if your monthly salary is Rs.50,000, and you have a monthly due of Rs.30,000, your debt-to-income ratio is 60%. Usually, lenders will consider your loan application risky if you have a debt-to-income ratio of more than 45%.
Also Read: 3 Ways To Get Personal Loan Without Income Proof Instantly
Conclusion
In most cases, people get a quick personal loan for urgent needs. But proceeding with the application in a hurry can lead you to miss any details which can be crucial in the future. Instead, do good research regarding various lenders and their offers. Then select the better choice which matches your requirements. Moreover, be aware of all the rules and regulations like processing fees and prepayment penalties to avoid any shocks in the future. So a wise choice made today can save you from a hazard in the future.
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Frequently Asked Questions
Q. What is an Online Personal Loan?
A. Online Personal loans are unsecured loans that you can avail of with minimum documentation and a hassle-free process by applying online.
Q. What is the minimum salary required to apply for a loan?
A. The minimum salary of an applicant should be Rs.18,000.
Q. Is it possible to pay off your loan earlier than your tenure?
A. Yes, prepayment is possible, but you have to check whether there are any penalties.
