How to

How to Know all about pre-approved personal loan

A pre-approved personal loan is an instantaneous loan that is disbursed to select consumers. It needs minimal documents and zero security or collateral. All you require is an excellent repayment record and credit history to be eligible for an instant credit facility. This kind of loan option is provided by many NBFCs (non-banking financial companies) and banks to enhance the loan product sale to mitigate the urgent financial requirements of the consumers and lower the loan disbursal time substantially. The offered interest rate can be anywhere between 9 % p.a. and 24 % p.a. for the pre-approved loan. But the interest rate may vary from lender to lender, and hence you should check with the lender’s rate of interest before you avail of the personal loan.

Important features you must know about a pre-approved personal loan:

Instant loan disbursal: In case you hold any existing banking relationship with the NBFC or bank, the pre-approved personal loan may be disbursed directly in a very short span of time.

Minimal documentation: Pre-Approved personal loan is an instant loan, which can be easily obtained, and the process is thought to be hassle-free as it does not need any heavy documentation for the approval of the loan.

No security or collateral required: Pre-Approved loan consumers do not require to offer any collateral or security to obtain the instant loan approval.

Differing loan proceeds: Pre-Approved loan proceeds differ for everyone. The loan amount is dependent upon factors such as the customer’s repayment record and credit history.

Repayment facility: You must repay the pre-approved loan in EMI form. Those consumers who hold an existing account with lenders can choose the auto-debit option to repay the EMI on time. Standard loan tenure is between 12 months and 60 months.

Fees and charges: Lenders charge specific charges and fees during the disbursal process of the pre-approved loan like secure fees, make money online, processing charges, outstation collection charges, EMI bounce charges, penal interest etc. The condition and various terms in relation to charges and fees vary with lenders.

Advantages of opting for a pre-approved personal loan

Quick funds: Being eligible for the pre-approved personal loan like SBI pre-approved personal loan or any other loan comes across to be a safety net when you require immediate funding to mitigate your financial requirements. This loan is usually approved as well as disbursed within hours of submitting the application once the verification process is done. You even can use the loan amount for personal reasons.

Competitive rate of interest: If you hold an excellent credit history, you become eligible for the instant loan. Your clean repayment record shows your financial discipline, and hence, lenders offer this loan at a competitive rate as you do not fall as per the lender risk and credit risk category.

Flexible repayment tenure: You can select the repayment tenure that suits you best. It generally ranges from 12 to 60 months. Factor in your repayment capacity when selecting the tenure so that you do not default on the loan repayment.

Nil to minimal documentation: The existing consumers who are eligible for the pre-approved personal loan need not fret about the documentation as lenders have your bank, KYC and income details saved in their database.

Paperless application procedure: Many lenders provide an online facility where you can place an application for the pre-approved loan via their mobile application or website by filling up as well as submitting the online form. Soft copies of the documents can simply be uploaded to the mobile application or website of the lenders.

Faster processing time: As you already have passed the loan eligibility criteria, lenders will not scrutinize you further. In case your papers are in the right order and all the financial info tallies well, then your loan may be approved as well as disbursed within the same day.

Negotiation power: In case of a pre-approved loan, the bank approaches you with the product and in place of you requesting for the loan. It means that you are in the position to negotiate apt terms of a loan with your relationship manager or bank manager and lower the rate of interest or enhance the repayment tenure. In case you are making an application on the online platform, this benefit will not be available as there is zero human intervention.

Special discount: For luring you to take up the pre-approved personal loan, banks might even add small advantages/benefits like waiver of processing charges, lower rate of interest than or EMI holiday for one to three months etc. If you want a loan, such perks will assist you to slightly lower your thorough estimated debt.  

Pre-Approved personal loan eligibility

∙       Eligible seekers should have an excellent credit history.

∙       Must be an existing consumer of the bank. Specific lenders lend to the new consumers even.

∙       Should have a completely clean record of repaying the debts.

Consumers with zero credit history as well as repayment records are eligible for the pre-approved personal loan if it is a substantial saving in your account and has a stable income source.

How can you apply for the pre-approved personal loan?

∙       Check with the bank if pre-approved loan offers are available. You can log on to your banking app and net banking account to see if you hold the eligibility for the pre-approved loan.

∙       Submit the duly filled up loan application form. You can get this from the lender’s site, branch office or through mobile application or SMS.

∙       Select the loan amount as well as suitable tenure. The loan amount simply will be credited to your account after verification of your details by the banks and once you accept the loan offer.

Banks and NBFCs might ask for the documents such as the previous 3 months’ salary slips, bank account statements, employee ID card, Aadhaar card, PAN card etc.

Important tips to avail of the pre-approved personal loan

∙       Maintain a strong credit score, excellent repayment record, good credit history, stable income source and considerable savings in your savings bank account to avail of the pre-approved loan.

∙       These loans might be available for a particular period; thus, make sure to check your lender.

∙       Do not miss out on going through the conditions of the loan with your bank or NBFC, particularly the fees and charges.

∙       Before you apply for the instant loan, consider doing a little bit of research. Ensure to compare different interest rates and features of the various loan offers with your available offer & select the one that matches your requirements.

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