Tips to get your personal loan approve quickly

We wish we all had loads of money to fulfill our quick financial needs without any worry, however, it’s not the case with everyone. Each one has its own income source and at some point, we do fall short of money and attempt to borrow finance. While a traditional financer will offer loan at exorbitant interest rate borrowing from friends or relative would be against your dignity. Thus, the personal loan would be an ideal solution to meet your financial demands.

Personal loans offered by leading banks, credit unions and fintech companies are the best options wherein you can borrow a set amount of money and pay the creditor off with certain interest rates within a stipulated period of time. These loans are unsecured loans because you don't have to put any collateral such as a car, home, etc. at stake to borrow finance. Lenders will evaluate factors like income source, credit history, existing debts and offer a loan with a particular interest rate.  With easy and convenient personal loan solutions, fintech companies are surely gaining an edge over lengthy procedures involved in applying for a loan to the bank or credit unions.

Financial institutions offer personal loans with fixed interest and it differs from one firm to another. Ideally, the interest rate varies from 11-37% per annum based on your credit score and income source.

Here are few tips that will ensure that your personal loan application is approved instantly:

Good Credit Score

Your credit score plays a decisive role in sanctioning the loan amount and the interest rate. Credit scores are calculated by your debt to credit ratio, and how timely repayment have you done on your previous loans. The more punctuality you show towards repayments, higher would be your credit score. It usually ranges from 350-900 and anything above 700+ is considered a pretty good score. It shows your willingness and how responsible you’re as a borrower towards your debt. Experts say to maintain a good score at least 3-6 months before applying for personal loans.

Avoid frequent loan                

As a thumb rule, it would be wise to maintain a gap of 6 months between two successive loans. Don't apply for a personal loan frequently when you already have a loan running in your name. Financial institutes view this as an added burden on your finance, check your income to debt ratio and see if you can completely make the repayments comfortably. Chances are your loan might get rejected.

The eligibility criteria

Every financial institution will have its own process, eligibility criteria to approve your personal loan. Many applicants don't bother maintaining the criteria before applying for the loan. It is important you fit into their eligibility criteria before approaching the lender. A generic criterion that follows across all lenders would be age should be between 21-60 years. Income source, salary certificates, IT returns, company designation, its listing and credit score reports

Check your risk appetite & Repayment ability

Financial institutes will scrutinize your repayment capacity before deciding the loan amount and approval of your loan application. They will check your current and future income source. And if you ask for an amount which is beyond the income source chances are they might reject the loan application. Comfortable monthly instalments till the loan tenure are what lenders will look at. 

Don't send multiple loan applications

Many people think that applying for multiple financial institutes will increase their chance of loan approval. However, it isn't true. It's better to apply for a loan to one lender at a time. Lenders pull the track records of your loan rejection and whether you have applied just one or two places or not. Thus, as much as possible limit your loan application