Deciding to take a loan is a big financial step. It comes with a full bag of questions such as, from where you can take a loan? What should be the correct amount? What would be the right duration and which loan policy is suitable for you? After sorting all these things in your head comes the biggest issue. What if your loan application gets rejected?
While applying for the loan, people take all the precautions still sometimes their loan application didn’t get approved. Especially, the borrowers opt for the personal loan under very difficult financial circumstances and not receiving it at the right time can become a really big problem.
So, what should we do to get instant loan approval? You must be wondering if there is any set way of getting it or is it luck based? Yes, we can answer all of your questions. You have to follow some easy steps and focus on some important reasons to get the instant loan approval.
Avoid taking Advantage:
It’s a good thing to have a good rapport in that particular bank where you are applying for the loan. Still, you should know your limits. Don’t apply a loan of 5 lakhs if your credit limit is 5 lakhs as it will create your image negatively in the eyes of lenders. The bank will consider you as a risky lender. Apart from it, your credit score will also get affected by this. So, it’s safe to go for a little less amount than you can actually avail.
Income Stability is Important:
Applying for a personal loan with a brand new job is not a good idea. However, it is not necessary that your loan application gets rejected because of a new job still; it can become one of the reasons in a few cases. Every lender wants to ensure that the borrower is efficient enough to pay back the loan which is only possible through stable income sources.
For instance, if you are applying for ICICI Bank top up personal loan even then the bank will check your income source. Yes, the top-up loan is taking another loan on the existing loan amount. Still, the bank will check whether you can pay off the collective EMIs or not. The person working in a known company or working since longer duration will have better chances of loan approval.
Keep your Documents Handy:
The documents play a vital role in your loan approval. You should check the required documents on that specific bank website properly before applying for any loan. Sometimes, the list of documents differs in various banks and hence it’s good to check on each bank website if you are applying for many personal loans at a time. Attach all the documents carefully after reading the given instructions. It’s a minor point but, it becomes a reason for many loan application rejections.
Don’t apply at too many Banks:
We understand that you need the loan amount as soon as possible and some people try to act over smartly to get it. We would like to tell you that this over smartness can lead to loan rejection. Applying for too many loans at the same time can affect your credit score negatively.
It gets affected every time a lender takes out your credit report. However, applying for a single loan at a time is also not a good idea considering the fact that finding a suitable lender is not an easy task. So, applying at online lending portals that can help you in comparing and choosing the perfect lender will be a good idea.
Don’t Ignore the Main Character – Credit Score:
Yes, credit score is the protagonist in the story of personal loan. Now, we would like to throw some light on what credit score is? It is a numeral expression just like your childhood school marks which depicts your value as a borrower.
It ranges from 300 to 900, and the higher score can become your golden key to loan approval. People with 750 or above score are considered excellent borrowers and the banks would like to provide them the loan with low interest rates. You can find ways to strengthen your credit score, and it’s good to check your score beforehand.
Limit your Current Liabilities:
You can improve your chances of obtaining the loan by limiting your current liabilities. It can affect your debt to income ratio positively by increasing it. This ratio also helps you in building a good image in front of the lenders.
It ensures the limit of the amount which you can borrow with your current income. So, if you want a high amount at low-interest rates, then you should focus on this point.
Mention a Significant Loan Reason:
You can take a personal loan for any reason but, it also determines your loan approval or rejection. It’s obvious that you should mention the real but a significant reason for taking the loan. You should avoid a few reasons which can become the cause of your loan rejection:
- Taking a loan for any illegal purpose
- Taking a loan for gambling or unnecessary things.
To get an instant loan, your reason for taking it should be genuine and accurate.
To get instant loan approval, you should use collateral if you have it. Although banks provide personal loans even without collateral security but, having it will be an additional advantage for you. It can help in getting low-interest rates, and fast loan approvals as banks prefer to grant the loan to the cases with lesser risk.
For example, you can easily avail ICICI Bank top up personal loan if you have already taken a loan from ICICI Bank by providing collateral security.
So, be vigilant while applying for any loan if it’s really important for you. Keep these points into consideration before submitting your loan application.