What Are Eligibility and Documents Required for Personal Loan?
A personal loan is a great option to seek funds for emergency purposes. It offers great support to meet all your financial requirements without the hassle of asking friends or relatives for financial assistance. It also provides you the ability to get one step closer to achieving your dream or eluding a financial disaster caused by uncertain events like that of the COVID-19 pandemic.
A personal loan in India serves multiple purposes and is availed by both salaried persons working for private or public undertakings and self-employed individuals generating a minimum net profit every year. The income and net profit limit depend on the lender’s policy.
A personal loan in India can be used for the following purposes:
Home renovation: You can repair, renovate, or furnish your house with a personal loan. Instead of putting a burden on your pocket, you can avail yourself of a loan and cover the cost of the repair, interior works, renovations, etc.
Marriage: A wedding in India entails extravagant expenses and affording it could be financially challenging for some people. However, you can take that load off your pocket by applying for a personal loan.
Education: Not everyone can afford to pay for the rising college fees. So, parents can opt for a personal loan in India to provide an education to their children.
Travel: You can now get a personal loan and travel the world without worrying about tickets, hotel stays, shopping, etc.
Medical: A medical emergency could be a financial shock. Hence, you or your family members could take a personal loan to pay for a medical emergency and worry about finances later.
Important features and benefits of a personal loan in India
Most of the personal loan’s popularity in India stems from the benefits and features associated with it.
- Depending on your repayment capacity, you can avail of a large sum of money as a loan and pay for major expenses like weddings, medical, or vacation.
- There is flexible and convenient loan repayment tenure. It generally ranges from 12 to 60 months.
- Unlike secured loans, there is no collateral required to get a loan.
- The documentation process is easy and quick.
- You can avail of attractive interest rates on personal loans.
Eligibility Criteria of a personal loan
Since a personal loan is collateral-free, there are minimum eligibility criteria. The basic criteria are:
- The minimum age at the time of loan application should be 25 years
- The maximum age at the end of loan tenure should be 60 years.
- You must earn a minimum income while being an employee of a private or public undertaking (Income requirement varies from city to city).
- You must be a citizen of India
- Your CIBIL credit score must be greater than 750.
Documents required for a personal loan
- Duly signed application form with a colored photograph.
- Proof of identity, age, and address: Aadhar card, PAN card, Voter ID card, Driving license, Passport, Utility Bill (Electricity, Gas, Water, Telephone) - Anyone.
- Proof of Income: Bank statement showing the previous three months’ credit transactions.
- Salary slip: For loans below 7.5 lakhs, the latest 1 salary slip. For loans above 7.5 lakhs, the latest 2 salary slips.