In today’s fast-paced world, financial needs can arise unexpectedly, and when they do, a Personal Loan can be a great option. If you’re seeking a quick and convenient way to meet unexpected financial needs, applying for a Personal Loan in India can provide the necessary funds.
The process of applying for a Personal Loan is now more accessible than ever before. In this guide, we will explore the step-by-step process of securing the best Personal Loan in India.
Things To Know Before Applying For A Personal Loan
Before applying for a Personal Loan, here are a few things you need to consider.
- Borrowers must know that maintaining a good credit score is crucial to get instant loan approval. The lender checks your credit score to ensure that you can repay the loan within time. So, consider working on your repayments to up your credit score.
- One of the most important things you must remember is that applying for a loan amount more than you need is risky.
- Before applying for a Personal Loan from any bank, go through the loan’s terms and conditions. It will help you learn about the details, including interest rate, other additional charges, repayment time, EMI schedule, etc.
- Checking the eligibility criteria is equally important to know whether you can apply for a Personal Loan. Additionally, consider checking what documents you must submit to get the loan.
Documents Required To Get A Personal Loan In India
Documents requested by different lenders might differ a bit. However, the essential documents that you should provide to the financial institutions or banks are listed below.
For Self-employed Individuals
If you are self-employed, you must provide the following documents –
- Identity Proof: Aadhaar card, PAN card, Voter ID card, or Passport.
- Address Proof: Utility bills, rental agreements, or property documents.
- Proof of Business Existence: Business registration certificate, GST certificate, or partnership deed (if applicable).
- Income Proof: Business financial statements for the last two years, IT returns, and audited financial statements.
- Proof of Business Ownership: Sole proprietorship declaration, partnership agreement, or memorandum of association (MOA) and articles of association (AOA) for a company.
- Bank Statements: Personal and business bank account statements for the last six months.
For Salaried Individuals
Here is the list of the documents that salaried individuals must submit to apply for a Personal Loan.
- As proof of identity, the borrowers must provide documents such as Voter ID, Passport, PAN Card, Driving License, etc.
- The individuals must also provide proof of residence, such as utility bills or rent agreements. Remember, the utility bill must not be older than three months.
- Three months’ salary slips
- Three months’ bank statement
- Two passport-sized recent photographs
The Steps To Apply For A Personal Loan In India
Applying for the best Personal Loan in India is simple and less time-consuming.
Step 1: Check the Eligibility Criteria
The borrowers must find out how much loan amount they can get before applying. The best way to know this is to check the eligibility criteria. However, the eligibility criteria may vary depending on different banks and financial institutions.
Step 2: Evaluate Your Credit Score
As your credit score is crucial in getting instant loan approval, the next step is to evaluate your credit score. A Credit score above 700 can help you get a low-interest Personal Loan.
Step 3: Check the Interest Rate and Additional Charges
The Personal Loan interest rate and additional charges vary from bank to bank. Therefore, after checking the eligibility criteria and your credit score, you must know and compare the interest rate being offered to you.
Step 4: Fill Up the Application Form
After checking everything mentioned above, you can start filling out the application form. However, you should double-check every piece of information provided to ensure instant loan approval. You can apply both online and offline for a Personal Loan, as most lenders offer both facilities.
Step 5: Submit all the Documents
Submit a copy of the required documents. First, check what documents you need to provide. It is a crucial step as if you submit the wrong documents, your loan application may get delayed or canceled.
Step 6: Wait for the Loan Approval
Once the bank verifies and approves your application and documents, it will disburse the loan amount to your bank account. Generally, the loan gets sanctioned within three days, but it may take more or less time as it varies from bank to bank.
Applying for a Personal Loan is a hassle-free and simple process. But you must up your credit score with a good history to get your loan disbursed quickly to your account. Follow the process mentioned above to receive an instant loan without delay.