From the middle class to the upper class, taking loans from banks is common practice these days. When buying a two-wheeler, four-wheeler or a house, people prefer to resort to bank loans instead of spending their savings. However, when applying for such loans, the borrower should take into account some important factors and if this is done, success is virtually guaranteed.
Speaking about the important factors that play an important role in loan approval, Jitendra Solanki, SEBI-registered tax and investment expert, said: “Some factors such as eligibility, job stability , cibil score, banking history and age at the time of the bank loan to apply are important parameters that play an important role in the approval or rejection of a loan application. ”
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Asked about the top 5 factors that will help the loan seeker to avoid rejection of their application, Solanki listed the following:
1]Eligibility: Whether or not you are eligible for a bank loan, this is one of the most important factors that can be checked before applying for the bank loan. To find out its eligibility, most banks have mentioned the eligibility criteria for the approval of the bank loan in question. One can go to the website of the bank (from which they are considering obtaining a loan) and check the eligibility of his loan.
2]Job stability: When approving a loan, a bank checks the job profile of the loan applicant. They check how long the employee has worked with the current organization and before that where they worked and for how long. They do this only to verify the stability of the borrower’s employment.
3]Cibil score: A bank also checks the target score of the loan applicant. Generally, a Cibil score of 750 or higher is considered better and leads to the approval of bank loans. Nowadays, various sites, available in a single search on Google, give the cibil score online at no cost. It is therefore better to check your target score before applying for a bank loan.
4]Age of applicant: The age of the loan applicant is important if the application is for the home loan. Typically, banks prefer people around 35 for the home loan because the borrower will have more time to pay off the mortgage than they have about 25 more years to earn.
5]Income of the loan applicant: Apart from this, the bank also looks at the annual income or the monthly income of the loan seeker. This helps them to realize the loan amount that needs to be approved at the applicant. Typically, banks prefer to approve loans at a rate where the maximum monthly EMI is set at around 40 percent of monthly income. If the applicant has already taken out a loan, their EMI is added when approving the loan in paydaynow loan request page.