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How Do Lenders Determine Your Personal Loan Eligibility?

By Aakash Jain - Feb 14,2022
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A Personal Loan is a financial solution that can be availed to fulfil one’s personal needs or financial requirements. The requirements can be related to wedding, travel, debt-consolidation, home renovation, education etc. A personal loan is also an efficient solution because it can be availed instantly and without any collateral. You do not have to pledge any security for getting a personal loan.

Today, with the advancements in technology and digitization, one can apply for a Personal Loan online through websites or portals. When you apply for a Personal loan, lenders or financial institutions consider various factors before sanctioning the loan. This is done so that they can check your capacity of repaying the loan.

So, here are the various factors the lenders consider to determine your personal loan eligibility.

Employment Type

This is the first factor that lenders take into consideration. Ideally, the lenders see if you are a salaried applicant or self-employed applicant. Lenders consider this factor as they want to check if you have a steady source of income and that you will be able to repay the loan without any difficulties. It is usually easy for salaried applicants to avail a loan as they have fixed source of income. Even self-employed individuals with stable income source have it easy.

Credit Score

Credit score determines the borrower’s capacity to repay the loan. In short, it determines the creditworthiness of the borrower. The credit score assures lenders that you will pay the loan on time without defaulting. Generally, credit score above 750 is recommended to get a personal loan at attractive interest rates. Below this, you will be charged a higher rate of interest. Very poor score can get your loan application rejected. So, it is important to maintain a high credit score before applying for the loan. It can be done through clearing outstanding bills, paying EMIs on time, not applying for multiple loans simultaneously etc.


Age is also an important factor that lenders consider to determine the eligibility. Age helps the lenders decide if you can cover the expenses accordingly. Usually, applicants between 23-65 are eligible for a Personal Loan.


Your work experience also helps the lenders to determine your eligibility for the loan. Typically, lenders consider applicants having a work experience of at least 1-2 years. This is because, they look for the steady source of income, through which you will be able to repay the loan on time. People working in multinational companies, government organizations or public sector enterprises stand a higher chance of getting a Personal Loan.


The documents generally required by the lenders include identity proof and address proof like Aadhaar Card, PAN Card, Voter ID, Driving License. Additionally, passport size photographs, income proof like salary slips, bank statement of past 6 months are also required.


It is very important to keep the above-mentioned points in mind, before applying for a personal loan, so that it is not difficult for you to avail it. You can get up to Rs. 25 Lakhs on Finserv MARKETS. The benefits of applying for a Personal Loan include smooth and 100% online process, zero collateral requirements, minimal documentation, flexible repayment tenures of up to 5 years, customised offers and much more. In addition, there are no hidden charges involved during the application process.


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Bajaj Finserv Direct Limited ("BFDL") is primarily engaged in distribution of financial products and services through its digital platform (“Bajaj Finserv MARKETS”) and inter alia renders services of customer acquisition, providing preliminary credit support activities, fulfilment services and post-acquisition customer services to Banks, NBFCs, HFCs. BFDL is also a registered Corporate Agent (Composite) under valid IRDAI registration number: CA0551 valid till 10-Apr-2024 for solicitation and servicing of Insurance Products. Registered Office: Bajaj Auto Limited Complex, Mumbai – Pune Road, Akurdi, Pune – 411 035 CIN: U65923PN2014PLC150522