Bank Loans Alert: Looking for a pre-approved personal loan? Precautions that you must take

Bank Loans: Pre-approved personal loans are steadily climbing the popularity charts these days and have become quite the go-to product for individuals seeking instant credit. These bank loans are mostly offered by private banks to consumers who boast impressive credit health. However, there are some precautions that one must take care of during personal loan apply.

Speaking on personal loans. Aditya Kumar, Founder & CEO at Qbera.com said, "If you are looking to apply for a pre-approved personal loan, you’ll have to satisfy a set of eligibility criteria. Apart from banks, some Fintech lending companies also offer pre-approved personal loans to eligible customers but follow an approach that’s different from the one adopted by banks." 

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Aditya said that the best thing about these loans is that they don’t require any sort of paperwork and are perhaps the quickest in the market. In the case of pre-approved personal loans, a lending decision is already made by the bank as far as the loan amount is concerned. The only thing the customer must do is apply for one. However, there are some set of precautions or information that a personal loan applicant must know before applying for the bank loan.

What are the bases on which banks select customers for pre-approved loans in India?

In order to qualify for a pre-approved personal loan from a bank, it is essential to meet certain criteria. If you are looking to get one, here is what you should know.

Your Credit Score: As is always the case, the Credit Score is the primary parameter that lenders use to determine the eligibility of an individual seeking unsecured credit. Say you want to apply for credit, and you have a low credit score. The probability of getting rejected by several lenders is formidably high. That said, quite naturally, a low credit score will preclude you from qualifying for a pre-approved personal loan.

Banks are particularly known to have a strict eligibility framework, often more stringent than the eligibility criteria adopted by Fintech lending companies and Peer to Peer lending platforms. 

Well, if your credit score is right up there, you’ll have no trouble in qualifying for one!

Your Income: The next parameter that lenders look at while evaluating applications for pre-approved personal loans is the income. You must meet the bank’s/Fintech lender’s minimum income criterion in order to get approved. Popular Fintech lending companies in India approve applications with a minimum net monthly income of Rs. 20,000 per month, whereas most banks require potential customers to have an income upwards of Rs. 30,000 per month.

Existing relationship with the bank: Having an existing relationship with the bank is another essential criterion to get approved for a pre-approved personal loan. It is easier when a customer has his savings/salary account with the bank in question. Having a good asset base with the bank in the form of investments/deposits is another way to get a pre-approved personal loan easily approved.

How do you get a pre-approved personal loan if you meet the above criteria?

Well, if you meet the above-mentioned criteria, getting your loan amount is a straightforward process. All you’ve got to do is to log into your bank’s net banking portal with your credentials and click on the option to apply for a pre-approved personal loan. Depending on your credit health, income and employment stability, you’ll know the amount you’re eligible for.

"Note that the sanctionable amount is already fixed based on your profile parameters (hence the term pre-approved personal loan). Once applied for, you’ll receive your amount almost instantly," concluded Aditya Kumar of Qbera.com.