In this article, you will learn the benefits of personal loans, the special features salaried individuals enjoy when availing of a loan, eligibility criteria, and more. Read on to find out more about personal loans for salaried employees.
The World has become a more connected place because of all the technological advances. Banking these days has become easier as financial institutions have made it more customer friendly. Moreover, with online banking, personal loans are much more readily available, and our access to the money we require is now at the tip of our fingers. Getting an instant personal loan online for salaried individuals is even more effortless. This is because salaried employees get a fixed monthly salary from their employer, which makes their repayment prospects promising. There are many benefits that a salaried employee will get with regard to availing of a loan.
What Are The Benefits of Personal Loan?
A personal loan is an unsecured loan that people can take for any monetary requirement that they have. It can be taken to fund a wedding, home renovation, travel, or medical expenses. Banks and financial institutions can give this loan to any eligible person. The eligibility requirements for personal loans differ from one Bank to another. The requirements are also less stringent than other loans like car loans or home loans. Taking out a personal loan makes it easier to deal with financial emergencies as it can be taken for several reasons. If you are a salaried employee with a regular income, you can take out a personal loan to help with all your minor and significant expenses, such as:
If you are a salaried employee with existing loan payments, consider taking a personal loan to clear all your pending past and current debts at low-interest rates. This will improve both your credit score and your repayment history.
Relocation can be an expensive affair. So, if you plan to relocate your home, consider availing a loan to cover all the necessary costs. Moving expenses include moving your household belongings from one place to another, purchasing new furniture, transportation vehicles, and more.
Health issues can occur unexpectedly at any time, and most times, there are insufficient funds to support such sudden medical expenses. This might make the situation more stressful. However, with a personal loan, you have a go-to option to instantly get financial aid within a few hours to cover all the medical expenses.
You may need a personal loan when making large purchases such as a house, car, or even electronic gadgets such as a TV, washing machine, and smartphone. These necessary expenses are quite expensive to purchase without the help of EMIs. But, another mode of purchase is to get a personal loan to buy the necessary items and pay in one settlement.
Weddings are fun, but they sure are expensive. So, when planning for a wedding, there is no way to do it without the help of a personal loan. Wedding expenses such as venue selection, catering, interior decoration, and wedding attire can be taken care of with the help of a small loan.
Home renovation is usually done before big occasions such as weddings or festivals. However, the cost of painting, renovating your kitchen, and remodelling the whole house can put a huge burden on your pockets. So, to handle such expenses, you can avail of an instant personal loan. This will help you deal with all the necessary expenses.
Everyone has a dream destination to travel to, and everyone needs a break by going on a vacation. So, instead of postponing it any longer, why not do it now? You can easily take a small personal loan and use it to travel to your dream destination without waiting for your savings to build up.
While it is easy to get a personal loan to fund various purposes, there are also special features that salaried individuals enjoy when availing of a personal loan.
Features of Personal Loans for Salaried Employees
Salaried employees get better benefits for personal loans from banks and financial institutions as they have higher job security. The interest rate for salaried borrowers is also a good rate compared to self-employed individuals. Some of the features of personal loans for salaried employees are:
- Salaried individuals are offered a personal loan with an interest rate that starts from 11.06 percent However, the interest rate will also depend on the lender or Bank.
- They can get approved for a loan up to 35-40 lakhs. The maximum loan amount will depend on the monthly salary of the borrower.
- The loan tenure is usually up to 5 years, although some banks can give a tenure of 7 years.
- There is no restriction on how a salaried person uses the personal loan.
- There is a processing fee charge on the loans, but it can be waived during festive seasons when the Bank provides special offers.
- Banks can also offer pre-approved instant loans to customers depending on their monthly income, credit score, age, and financial history.
The eligibility criteria for a personal loan will usually depend on the lenders and financial institutions. However, below are a few general criteria that should be met:
- The borrower must be an Indian citizen.
- They must be at least 21-60 years of age.
- They should be employed by the government or private sector companies for a minimum of 1 year.
- The minimum salary for personal loan should be at least INR 20,000 per month.
- They must have a credit score of 750 and above.
Also Read: Instant Personal Loan Through Aadhaar Card
Credit Requirement for Salaried Employees
Usually, a credit lender checks the income proof and credit score of the applicant before issuing a personal loan. A credit score of 750 or above and a stable income are what lenders prefer when giving out a loan. The Bank will give a personal loan for salaried employees at a specified amount and a fixed interest rate over the loan’s tenure.
Moreover, a good credit score will not only help to check the applicant’s eligibility, but it will also help them get a loan at comparatively lower interest rates. The score is generated by the central credit bureau, such as Equifax, Experian, TransUnion, and CRIF High Mark. It is calculated based on repayment history, credit mix, number of credit inquiries, and length of credit history.
The documents required to apply for personal loan for salaried individuals will differ from one Bank to another. Some of the necessary documents that will be required are:
|Sl. No.||Particulars||Documents required|
|1||Proof of Identity||Aadhar Card, PAN Card, Driving License, Passport|
|2||Proof of Address||Electricity Bill, Water Bill, Passport|
|3||Proof of Income||Salaried: Bank statement for the past six months|
|4||Work experience||Employment Certificate for a minimum of 1-year experience|
Why Are Personal Loans Better Than Other Types Of Loans for Salaried employees?
Personal loans are great when you need instant funds. Plenty of reasons show why personal loans are a better option than other types of loans. These are:
As personal loans are unsecured, you don’t have to submit any assets as collateral to apply for the loan.
There are no limitations on the usage of personal Loans. It can be used for multiple reasons, such as medical expenses, travel expenses, wedding expenses, home renovation, and purchasing cars or electronic devices.
Since there is no need for collateral, there are only a few documents that are mandatory for your KYC certification, such as your Aadhar Card, PAN Card, passport, voter ID, income proof such as payslips and bank statements, and more.
The application process for a personal loan can be done entirely online, and it is paperless. Therefore, it is quick and easy without a borrower wasting time by visiting the Bank to apply for the loan.
Instant Loan Disbursal:
As it is an online process, the verification process is quick, and you can get your loan amount disbursed to your bank account within 24 to 48 hours.
You can choose your repayment tenure for a personal loan which usually starts from 6 months to 60 months. You can repay the loan amount through monthly EMIs.
Getting a personal loan has become very easy in today’s world because of the ever improving technology. Instant loans are disbursed in a short amount of time through online portals. Thus, below are a few steps on how to apply for a personal loan online.
Steps To Apply For An Instant Personal Loan Online For Salaried
There are only five simple steps to apply for an instant personal loan online for salaried employees.
Step 1: Visit the official website of your bank or lending institution and apply for a loan through their online website. You can also choose online loan aggregators like Lendingkart, Buddy Loan, or Bajaj Finserv to apply for a loan.
Step 2: Next, make sure you meet all the required eligibility criteria of the lender before applying for the loan. You can also calculate your EMI by filling in the desired loan amount and tenure to get a clear picture of your total repayment amount.
Step 3: You can then fill out the application form with all the necessary personal and professional details like your email address, employment type, monthly salary, and so on.
Step 4: Once the application form has been submitted, the verification process will begin. The representatives will cross-verify the information provided with your documents and then approve your loan once the verification is completed successfully.
Step 5: Your Loan will get sanctioned instantly, and your loan amount will be disbursed to your bank account within 24 – 48 hours of verification.
Things to Remember Before Applying For An Instant Personal Loan Online
Before you apply for a personal loan, you must consider various factors to have a smooth process to get your loan sanctioned instantly.
The most important factor you must remember is to check if you qualify for all the required criteria mentioned by the bank or lending institution. Once you meet all the required standards, you can apply for a personal loan without hassle.
It is an essential factor that determines your creditworthiness. The reason why lenders check your credit score is to know whether you will be able to repay the loan amount on time. They also expect you to have a score above 750 to qualify for the loan. Hence, you can get personal loans at comparatively lower interest rates if you have a high credit rating. If you want to know your credit health, you can check your score using online calculators. Remember to always check the credit report to keep track of your financial situation.
Lenders consider your Debt-To-Income ratio to know whether you can manage current and past debts with your current income. And it also gives them an idea of your ability to repay the loan on time. Therefore, make sure you maintain your Debt-To-Income ratio to be less than or equal to 50%.
Before applying for a personal loan, plan and budget your required amount. This will help you avoid being in unnecessary debt. You can calculate the EMI and choose the loan amount and tenure according to your repayment ability.
As you have read in the article, a personal loan for salaried employees is quite easy to obtain. Understanding the benefits you can get from banks if you are a salaried individual is great, as you can make better and more informed decisions regarding your financial health. With this knowledge, you can make the most of your loan and save money while obtaining a personal loan online with lower interest rates. Remember to also check your credit score using online calculators and get your credit report instantly to know about your credit health.
So what are you waiting for? Apply for a personal loan online through the best loan aggregators and financial institutions or visit their official website.
Frequently Asked Questions
Q. What is the maximum amount I can take using a Personal Loan?
A. Depending on the Bank you are borrowing from, you can apply for a personal loan up to INR 15 lakhs or 40 lakhs. The maximum loan amount will also depend on your monthly salary.
Q. What is the minimum age requirement for a personal loan?
A. You must be above 21 years of age to qualify for a personal loan.
Q. What is the minimum monthly salary required to apply for a personal loan?
A. The minimum salary for personal loan for salaried individuals will be INR 20,000 or INR 21,000, depending on the Bank or financial institution you’re borrowing from.
Q. I don’t have a salary slip. Can I still apply for a personal loan?
A. Yes, you can still apply for a personal loan even if you don’t have a salary slip. However, you must submit an alternative proof of income, such as Form 16, during document submission.
Q. I have a credit score of 550. How can I improve my score?
A. You can improve your credit score by using these simple steps:
- Make loan payments on time
- Repay all your outstanding dues and clear your debts as soon as possible.
- Avoid multiple hard inquiries
- Check and review your credit report regularly to identify and rectify potential threats.
- Maintain a credit utilisation ratio of less than 30% to your credit limit.
Q. Can I get a personal loan if I’m a salaried employee but my company is not listed in the Bank’s “approved list of companies”?
A. This will depend on the financial institution or bank you choose to borrow from. Most lenders will prefer companies already on their list of approved companies. So, it is difficult to obtain a loan. However, you can opt to borrow from online loan aggregators. They will match your profile to potential lenders, and you will also be able to compare their interest rates.