Personal Loans 101- Forms, Requirements & Documents You Need

Personal loans are helpful whenever you need cash urgently, helping you tide over emergencies, cover sudden expenses, etc. They are also unsecured loans, meaning that collateral is not required to obtain them, which is another advantage. However, if you were wondering how to apply for an instant personal loan online and all the documents, forms, and other requirements, here is a ready reckoner you can use.

How to Apply for a Personal Loan Online

The process of applying for a personal loan is quite simple. It involves the following steps at the official websites of most lenders.

• Check your eligibility online at the lender’s website.
• Choose the tenure of the loan and your desired amount.
• Fill out the online form with the necessary details and submit it.
• Get your loan disbursal instantly upon verification.

Documents that You Require

There are a few documents that you will need to apply for an instant personal loan online. They include:

• Aadhar Card or any other identity and address proof accepted by your lender.
• PAN Card.
• Details of your bank statements (last six months).
• Some lenders may also require salary slips, or IT returns to confirm your monthly income.

Eligibility Criteria for Personal Loans

The basic personal loan eligibility criteria include:

• Age limit- This varies across lenders. Some may allow applicants between 23 and 55 years, while a few banks may extend this to 60. The minimum age to apply may also be anywhere between 18-25 in some cases.
• Monthly Earnings- The minimum income threshold also varies from one bank to another. You will usually require a minimum monthly income of Rs. 20,000 or Rs. 2.4 lakh annually to apply for a personal loan. Some lenders may have higher minimum income requirements, ranging from Rs. 25-30,000.
• CIBIL score- Aim to maintain a CIBIL score of at least 675 or higher since it will increase your chances of getting the personal loan approved at a lower interest rate.

Now that these basic aspects are sorted, let us look at some tips you can use while applying for personal loans.

Considerations While Applying for a Personal Loan

Here are some additional things worth noting while applying for a personal loan:

• Check the processing fees and other costs of the loan.
• Choose a lender with a 100% digital process or a personal loan app to save time and hassles.
• Check the interest rate on the loan and compare it with other lenders before making a final decision.
• Before you apply, check your CIBIL score and credit report for errors or inconsistencies. If you have a lower CIBIL score, then you can consider repaying credit card dues and other unsecured debts to improve it before submitting your personal loan application.
• If you have no/limited credit history, the lender may ask for a co-signer as assurance.

Conclusion

These are a few of the things that you need to keep in mind while applying for personal loans. From the application procedure to documentation, everything is simpler with a digitized process today. At the same time, instant disbursals make it more convenient to urgently get money to meet diverse needs. So, check the lender’s eligibility criteria and other guidelines carefully before applying for the loan.