January 2020 saw a 17% increase in the personal loan sector in India. Personal loans have continued with the upward trend even as credit growth has slowed down in the past few months.Easy access to finance is also driven by the entry of non-banking financial companies(NBFCs) in the market.
However, there has been a shift in the mindset of the consumer. While earlier unsecured loans were used to fund big ticket purchases, today, people are using them to buy the latest mobile phone or even flight tickets for a holiday. Easy accessibility to finance has led to reduced average loan ticket size in India as observed by Transunion CIBIL from ₹95,000 in 2018 to ₹35,000 in 2019.
So, if you too are thinking of taking a personal loan like the available on Finserv MARKETS, but are wondering if the approval would be as easy as it seems, here are few ways to up your chances of getting personal loan:
Ensure your credit score is good:
Your credit score is a reflection of your ability to repay the loan and it is often the first parameter to be considered by the lender. Those with a CIBIL score of 760 and above can easily get an unsecured loan. However, if you have a lower score and are thinking how to get a personal loan, the strategy should be to wait and work on improving your score. Repaying your existing loans, bills, installments and credit card dues on time can increase your score as well as your chances of approval the next time you approach a bank or NBFC with a loan application. Steer clear of late payments and accumulated debt to maintain a good credit history.
Avoid applications to many lenders:
It might sound favorable to apply to different financial institutions to increase your chances of getting personal loan, however, this approach can backfire. It only signals your desperation for credit to the prospective lender. Multiple applications could be an indication that you are not doing well financially and are already debt ridden, a picture that would not even land you one, forget multiple personal loans. Further, a rejection by a financial institution could bring your credit score down further, making the road for loan sanction even more tougher than before.
Time your loan applications:
It is advisable to wait for at least 6 months between two loan applications. Taking a step back and applying for a personal loan after a few months demonstrates your financial stability and discipline from a lender’s perspective. If you are wondering how to get a personal loan after multiple rejections due to hasty loan applications, what you need to understand is that exhibiting such behaviour reduces your credibility and loan repayment capacity as a borrower in the eyes of a financial institution. Moreover, since financial institutions disburse loans to rejected borrowers after a specific period, it is wise to use this time to improve your credit score by repaying existing debt.
Keep outstanding debt to a minimum:
There is a limit to how much you can borrow. This is determined by the debt to income ratio which is the monthly debt that you need to repay divided by your total income in a month. The lower you keep this, the higher are your chances of getting a personal loan sanctioned. As a rule, you should be spending less than 40% of your income to pay off any debt such as credit card, EMI or loans. Borrow only if absolutely necessary, else avoid. Your chances of getting personal loan decrease if you have an outstanding loan amount that is more than what you can afford.
Choose a reliable lender:
After you understand how to get a personal loan, it is important that you zero upon a financial institution that is credible and trustworthy. Compare different loans offered in the market. Avoid short-term unsecured loans and title loans. The high charges associated with these might push you into debt further thus bringing your credit score down. Be skeptical if a lender is ready to offer you a loan despite a poor credit score, even if they claim specialization in high risk borrowing. Any offer that seems too good to be true should be inspected thoroughly. Do not give in to the temptation of not doing your homework and taking a loan in haste. Due diligence is necessary.
If you follow these guidelines carefully, you will easily be able to get a personal loan in the future. Hassle free, quick approval, minimal documentation personal loans available online on Finserv MARKETS are what you need. Whether it is funding your home repair, or a trip abroad, a wedding in the family, or buying a car, you can get upto ₹25 lakh instant personal loan available on Finserv MARKETS approved in just 3 minutes.
What’s more, it also comes with a flexible duration ranging from 12 months to 60 months, personalized pre-approved offers, 24X7 online access to your loan account and no hidden charges! The loan application process is completely online for your convenience. All you need to do is fill an application form once you check your eligibility and upload a few necessary documents.
Post verification your loan is approved and the loan amount is credited to your account within 24 hours so that you can utilize it promptly to meet your needs. So what are you waiting for? Take the first step towards realizing your dreams with a personal loan available on Finserv MARKETS.
Finserv MARKETS, a subsidiary of Bajaj Finserv, is a one-stop digital marketplace that has been created for consumers on the go. It offers 500+ financial and lifestyle products, all at one place. At Finserv MARKETS, we understand that every individual is different. And that’s why we have invested in creating a proposition – Offers You Value. A value proposition that ensures you get offers which are tailor made for you. We also offer an amazing product range and unique set of online offers across Loans, Insurance, Investment, Payments and an exclusive EMI store. Be it in helping you achieve your financial life goals or offering you the latest gadgets, we strive to offer what you are looking for. From simple and fast loan application processes to seamless and hassle-free claim-settlements, from no cost EMIs to 4 hours product delivery, we work towards fulfilling all your personal and financial needs. What’s more! Now enjoy the same benefits in just one click with our Finserv MARKETS App.