Over the years, the accessibility of personal loans has eased significantly in the Indian financial market. Today, several lending institutions provide funding options across the country. The introduction of dedicated personal loan apps has further made it possible to avail funding through a few clicks on your smartphone. All you need to do is download a loan app on your phone, choose the best lender and click on apply.
The ease of access to quick finances is one of the prime reasons why personal loans are rising in popularity. The increased demand for these loans can be accredited to several other factors as well. For one, these loans are readily available for meeting emergency financing needs. Especially when accessed through platforms like an online cash loan app, one can avail funding within a few minutes.
Furthermore, factors like high financing value, suitable repayment tenure, and easy EMIs make these loans very attractive. However, you must be very cautious while applying for a personal loan. Here are 5 pro tips that you must know –
Top 5 Tips to Utilise for Easy Personal Loan Accessibility in India
1. Take initiatives for credit score improvement
When availing a personal loan, the first thing that you must do is that personal loans are unsecured loans. This means you do not need to provide your assets as security against the funding. This makes personal loans a high-risk proposition for lenders. So, as a precaution against risk, they assess the borrower’s credit profile and check their previous credit history.
The credit score precisely reflects a borrower’s attitude towards repayment. A higher score means the borrower has a history of paying his EMIs on time. While a low credit score reflects a borrower’s negligence or failure towards regular payments.
If you have a poor credit score, then there are a few pro tips to improve your credit score. – Some of the best ways to improve your credit score are –
– Paying off your small-ticket dues.
– Making timely EMI and credit card bill payments.
– Borrowing a balanced mix of secured and unsecured credit.
– Limiting credit card utilisation to 30% of the total availability.
– Keeping the fixed monthly obligations at not more than 50% of the fixed monthly income
In addition to these, check your credit report thoroughly to see if there are any errors or omissions. If you have recently closed a loan account, then make sure it reflects in your credit report. You can get in touch with the credit history bureau and raise a dispute.
2. Check and meet all eligibility requirements
Another important aspect that you must check before applying for a loan is the eligibility criteria. The eligibility factors may include your age, minimum monthly income, and occupation. If you choose to borrow through a personal loan app, then you check your eligibility in a few clicks. Also, note that the eligibility criteria differ from lender to lender. So, before you apply for a loan, make sure to compare the eligibility requirements of different lenders.
3. Submit all documents related to income sources
If you have more than one income source, then you can leverage it to gain lender preference when applying. The lender may also offer you attractive interest rates or other offers as having multiple sources of income decreases their risk. So, if you have any other source of income, then make sure to submit all the documents related to your income. The same is applicable if you add a co-applicant to your loan application. Having a salaried co-applicant improves your repayment capacity. This will help you get better interest rates and secure your loan approval with ease.
4. Apply through personal loan apps
The introduction of personal loan apps has been a phenomenal change in the way people borrowed. These apps are easily accessible and help you with swift borrowing. With simplified eligibility and minimal document requirements, they help fast-track loan processing, thus enabling quick approval of the advance.
5. Apply within your maximum loan eligibility
One crucial aspect that people often miss out on is deciding on how much to borrow. Usually, one applies for the maximum loan amount one is eligible for. While doing so, you exhaust your borrowing capacity. In addition to that, it also positions you as a high-risk financial standing for lenders. Thus, to eliminate such a risk-amplification, it is best that you apply for a minimum loan amount that you absolutely need.
Getting a personal loan is not a bad idea. In fact, in many situations, it is your best option. A personal loan is usually not a huge amount which makes repayment easier. If you are someone who has never availed a loan before then applying for a personal loan can improve your credit score. You can download the personal loan apps on your phone and get your loan processed within minutes.