Personal loans are among the most popular options to avail when looking to meet a wide range of expenses. With easy application and quick approvals, availing personal loans online requires just a few simple clicks. Despite this, there’s always a possibility that your application may get rejected. Common reasons why a lender may reject your application include low credit score, incorrect information, low income, high number of previous loans and more. As a result, it becomes important to use a personal loan eligibility calculator before applying for a loan.
A personal loan eligibility calculator is just as easy to use as an emi calculator for personal loan. It takes into account various factors based on which it outputs an estimate of the maximum loan amount you can get. Keep in mind that the personal loan eligibility calculator only gives you an estimate, and does not guarantee approval. It is designed to assist you in planning your loan efficiently.
Read on for more information about the four essential factors you should know to use a personal loan eligibility calculator.
Monthly income and expenses
Your monthly income is one of the most important factors that determine your eligibility for a personal loan. Your income speaks to your ability to pay EMIs in full and on time. Do note that certain calculators will state that you are eligible if you meet the minimum income criterion. However, this is not a guarantee of approval as income is not the only factor that determines your eligibility.
Your monthly outgo is also considered and is just as crucial. It is often referred to as your debt-to-income ratio. A high ratio will lower your chances of approval. To offer easy approval and the lowest interest rate, personal loan issuers generally prefer applicants to have a low debt-to-income ratio.
Date of birth
A personal loan eligibility calculator requires your date of birth to determine your age. Your age is an important factor because it is a core criterion that lenders consider. In some cases, the loan tenor you can avail is dependent on it. Younger applicants generally enjoy flexibility in this regard because they have many earning years left. On the other hand, if you are close to the age of retirement, you may not qualify for a longer loan tenor or the loan itself.
City of residence
Your city of residence is an important factor when using the personal loan eligibility calculator because lenders usually have a minimum income requirement for each city. Generally, urban cities have a higher income requirement as compared to rural or semi-urban areas. To know the amount you are required to earn on a monthly basis, check the lender’s official loan webpage for these eligibility terms.
Employment details
Some personal loan eligibility calculators will require you to enter your employer’s details. This could be the organisation’s name and the length of your employment. Here, working at a reputed organisation is beneficial. What’s more, having several years of experience with the company speaks to your job stability, and also your financial stability. Generally, lenders prefer a minimum employment period of one year with the same organisation. The longer you work with a company, the better are your chances of getting favourable terms for your personal loan.
These are the important factors of a personal loan eligibility calculator and you should be aware of these to ensure you get accurate estimates. Keep in mind that these results are estimates only. Some lenders may also have other eligibility criteria which they will consider when you send an offline or online personal loan application. For easy access to funding and in a completely digital process, apply for the Bajaj Finserv Personal Loan.
Get up to Rs. 25 lakh as a sanction, and without requiring any collateral whatsoever. Additionally, you can use the personal loan eligibility calculator to know if you qualify by simply entering basic information. The tool is free to use and user-friendly. You also get a flexible tenor of up to 60 months to ensure that repayment is easy and EMIs never exceed your budget. To get started right away and access an attractive deal, check your pre-approved offer online.
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