WHAT DO BANKS LOOK FOR WHEN REVIEWING THE PERSONAL LOAN APPLICATION?

Getting a personal loan depends majorly on your application. With the soaring demand of personal loans, thousand of people apply for it. Your personal loan application plays a vital role in convincing the banks and NBFC (Non-Banking Financial Companies) that you deserve this loan. All you need to do this go through the eligibility criteria and the document requirement of the banks and NBFC (Non-Banking Financial Companies) and then fill out the application form dutifully with accurate and genuine information. You need to think from the perspective of the lender and find out their needs. Some points that banks and NBFC (Non-Banking Financial Companies) consider while reviewing a personal loan application are:

• Credit score-

This is the first thing usually lenders look for in a personal loan application. Every financial institution has a prerequisite of a certain level of credit score. This credit score should be ideally 750 and above. Your creditworthiness is reflected in the credit score allotted to you. A good credit score will have a good impression on the lender.

• Capacity-

The lenders check the repayment capacity very carefully. There is a minimum income level requirement that banks and NBFC (Non-Banking Financial Companies) specify before they grant the loan. The lender will check your financial history and stability. The personal loan amount that the lender will sanction depends on your income and repayment capacity.

• Collateral-

Generally, the personal loans are unsecured so there is no need to worry about the evaluation of collateral but in the case of secured personal loans, the lender will assess the quality and quantity of the security provided.

• Character-

The intention to pay back the debt of an individual is important. The lender will thoroughly go through your credit report and see if you have made any defaults and observe your repayment pattern. Then the lender checks your references.

Besides the basic criteria of age and income, the bank and NBFC (Non-Banking Financial Companies) has the aforementioned points in their checklist before they grant you the personal loan.

SBI personal loan policy is now available at a minimal personal loan interest rate starting from 10.50% per annum with a hassle-free application process.

It will be beneficial for the applicants to verify their details even before filling out an application. Self-assessment will help you to apply for a personal loan and comply with the terms in a better way.