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Personal Loan Procedure & Eligibility
Eligibility Criteria for a Personal Loan
Your eligibility for a personal loan depends on a number of things, like your age, whether you are a salaried individual or a self-employed individual, the duration of your current job, and much more.
- Minimum Age Requirement: Generally, lenders require the borrower to be at least 18 years of age.
- Minimum Income Requirement: The minimum income requirement may vary based on the creditworthiness and loan requirements of the borrower.
- Salaried Individuals: Applicant must be a salaried employee in the public or government sector organisation or must be employed by an established and reputed private sector organisation.
- Self-Employed Individuals: Self-employed individuals who meet the minimum income requirement are also eligible for a personal loan.
- Others: Individuals who are willing to provide 100% collateral in the form for LIC policies, RBI bonds, NSCs, or other forms of tangible security can also avail a personal loan.
- Employment Stability: Individual must meet the requirement for minimum years of service at the same organisation.
- Credit Score and History: Ideally, an individual’s CIBIL score should be 750 or above, though some personal loan schemes also accept CIBIL scores starting from 600. The individual should also have a consistent record of timely repayments.
What Factors Impact the Personal Loan Eligibility of an Individual?
There are various factors that can affect the personal loan eligibility of an individual, including:
- Income: If an individual has a high income, they are eligible for a larger loan amount and may even be able to get lower interest rates. The income of the individual is one of the criteria on which their repayment capacity is calculated, so the higher your income is, the better is your personal loan eligibility.
- Source of Income: A steady monthly income signifies that an individual will be able to pay their EMIs regularly, which helps improve their personal loan eligibility. For salaried individuals, who their employer is, how long they have been working with the present company, their total work experience, etc. are considered. On the other hand, for the self-employed, their IT Returns, P&L statements, etc. are checked.
- Existing Debts: If an individual is already paying EMIs for different loans, a part of their income will be dedicated to the same. This impacts their repayment capability and depending on their income and fixed debt payments for each month, their personal loan eligibility will also change.
- The Credit Score: An individual’s CIBIL or credit score denotes their creditworthiness and is a reflection of the individual’s history with previous loans or debts. A higher credit score means higher personal loan eligibility and the chance to get lower interest rates. Non-payment or late payments of EMIs, credit card bills, etc. can lower your credit score. However, it is also possible to improve your credit score with a little work. So, before applying for a personal loan, check your credit score.
- Nature of Employment: Individuals who are employed by the government or public sector or by well-established private sector companies have higher eligibility for a personal loan, as they are considered to be in stable jobs, which helps ensure their repayment capability, making them low-risk applicants for lenders.
- Age: Apart from the basic requirement of the applicant being over the legal age for getting into financial contracts, age also affects eligibility. For example, a younger person who has only been working for a few months is considered as a high-risk applicant as there is no actual guarantee of their repayment capacity or capability, while a person nearing retirement age is considered to have a smaller earning window, hence affecting their eligibility for the loan as well.
- Geographical Location: Different areas and regions in the country may have different rules and regulations in place. That is why the area where you live also plays an important role in determining not only eligibility but also interest rates for personal loans.
Personal Loan Process: From Eligibility to Disbursement
- Assess Your Eligibility: Before applying for a personal loan, you must check if you meet the eligibility criteria for that loan scheme. Typically, eligibility requirements include a minimum credit score, stable income, employment stability, debt-to-income ratio requirement, and age limit. The exact eligibility requirements may vary with different lenders.
- Choose the Right Loan Offer: Don’t just settle for the first personal loan offer you come across. Put in some research and compare different personal loans based on their interest rates, terms, repayment flexibility, etc., and choose the one that meets your needs best.
- Gather Your Documents: Check the list of documents required for applying for the personal loan and ensure that you are prepared for the documentation process. Usually, lenders ask for an identity proof, address proof, proof of income, proof of employment, bank statements, income tax returns, and salary slips (for salaried individuals).
- Submit Your Application: Submit the duly filled application form with all the necessary documents to the lender. Double-check everything for accuracy, as mistakes may lead to the rejection of your personal loan application.
- Verification and Approval: In this step, the loan provider verifies the authenticity of your application. Your documents and credit history are verified, the lender may also contact your employer for confirmation, and your bank statements are reviewed to assess your repayment capacity during this stage of the process.
- Loan Offer: Once your application has been verified and approved, the loan provider will present their personal loan offer based on your eligibility. Once both parties are in agreement, the loan agreement will be signed.
- Loan Disbursement: After the signing of the loan agreement, the loan provider will initiate the process to transfer the funds. The disbursal time may vary with different lenders, but most loan providers today, like Muthoot Finance, offer instant personal loan disbursement.
Why Choose Muthoot Finance to Check Your Personal Loan Eligibility?
Muthoot Finance is dedicated to ensuring that everyone has easy access to a variety of financial services. So, we offer customers access to personal loans that require no collateral and come with affordable interest rates, quick processing, minimal documentation, flexible repayment options, a simple and easy online application process, and quick disbursals.
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Ask an Expert
CUSTOMER SUPPORT NO.:
080-35392825
(Mon-Fri, 10 AM to 6 PM)
WRITE TO US:
plcustomersupport@muthootgroup.com
BRANCH TIMINGS:
Mon-Sat, 9:30 AM to 6 PM
Ask an Expert
CUSTOMER SUPPORT NO.:
080-35392825
(Mon-Fri, 10 AM to 6 PM)
WRITE TO US:
plcustomersupport@muthootgroup.com
BRANCH TIMINGS:
Mon-Sat, 9:30 AM to 6 PM
Personal Loan Procedure & Eligibility FAQs
The eligibility for a personal loan may vary with different applications but the general personal loan eligibility criteria for an unsecured loan include:
- Applicant should be a resident of India
- They should be between 21 and 67 years of age
- A credit score of 750 or more
The applicant should have the ability to provide 100% collateral security and fulfil the demands put forward by Muthoot Finance for their risk profile.
The amount gained through a personal loan is applicable according to the monthly salary of the applicant. The expenses made every month by the applicant are also a deciding factor to get a personal loan. Muthoot Finance provides personal loans that begin at around 50,000 and can differ for different individuals. You can also calculate the amount of personal loan you can get with the help of the personal loan eligibility calculator on the website.
The eligibility for a personal loan for an applicant depends on their monthly income. At the time of loan amount calculation, the applicant’s monthly income and expenses are considered, along with their CIBIL score and other similar metrics. It is advisable to get in touch with a representative from Muthoot Finance for further clarity on the subject.
The minimum limit for an applicant to get a personal loan depends on their monthly income and expenses. It also depends on the individual’s credit score and risk factors. Muthoot Finance provides personal loans starting from INR 50,000 according to the applicant’s employment type. It is necessary to analyse the risk factors and credit history of the applicant for instant personal loan approval.
Any applicant who is looking for a personal loan needs to submit all the documents and ensure that they are verified by Muthoot Finance representatives. As soon as the application and documents are verified, the applicant can get their loan according to their chosen payment method. Applicants can also get a personal loan online after they have submitted copies of all the necessary documents through the application portal on the Muthoot Finance website.
Suggested Read: What Is the Eligibility and Requirement for a Personal Loan?
The most important documents required for a personal loan are as follows:
- Salary certificate
- Income Tax returns for the previous 3 years
- ID proof
- Address proof
These are accompanied by any other important documents for personal loan that are requested by the Muthoot Finance representative at the time of personal loan application.
The duration of verifying documents for an online personal loan application differs from applicant to applicant. However, Muthoot Finance can provide you with personal loans as soon as the verification process is completed. The amount requested is disbursed according to the payment method chosen at the time of filling out the loan application.
A personal loan helps in fulfiling any emergencies that the applicant can complete within a short time. Due to its easy eligibility and documentation, it is also called an all-purpose loan.
Muthoot Finance helps you in the verification process of the personal loan service.
However, there are no extra charges payable when availing personal loan services.
The age range to apply for a personal loan online is 21 to 67 years of age with Muthoot Finance. However, it is important to note that the individual applying for a personal loan is 18 years. Due to the high risk factor, younger individuals with a few months of working experience might not be able to get the loan. On the other hand, older applicants, especially those close to retirement age, they are also may not be able to apply for a personal loan online. However, it is advisable to get in touch with a representative from Muthoot Finance so that you can get further information regarding the minimum age of application.
At the time of applying for a personal loan service, it is necessary for the applicant to have a good credit score. It provides a positive reflection on the applicant’s personal history with respect to previous loans and debts. A higher credit score increases the chances of the personal loan is granted. It is advisable for you to get in touch with a representative of Muthoot Finance to learn more about the personal loan service.
Salaried individuals need to provide details regarding their employer, years of working with the employer and their total years of work. It is also important to provide salary proof dating back to three months as a personal loan cannot be granted without income proof. Self-employed individuals need to provide their IT return proofs, P&L proofs and other necessary documents to ensure that the personal loan is granted without any issues.
The applicant for a personal loan with Muthoot Finance should submit their proof of income for the past three months. It will be helpful for Muthoot Finance representatives to process the application for personal loans online quickly. Salaried employees should provide three months of salary proof and bank statements along with IT returns. On the other hand, self- employed individuals can provide P&L statements, IT returns and other similar proof for the approval of their applications for personal loans done online.
The qualifications for a personal loan applied online at Muthoot Finance should fulfil the requirements of total salary, age, years of service remaining, total years of work and the applicant’s risk profile and credit score. It is important to remember that Muthoot Finance can reject the application for a personal loan applied online due to any specific criteria being unfulfilled.
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