The monthly income of an individual plays a crucial role when applying for a personal loan. This is because financial institutions assess applicants’ monthly income while determining the loan amount they will be eligible for. However, individuals with low income or low salaries also can avail of a personal loan to fund personal expenses. Read on to know the process to avail of a low salary personal loan.
Ways to avail a personal loan with a low salary
Following are lists of strategies that will help prospective borrowers with low-income qualify for personal financing:
Include every source of income
While checking the income of loan applicants, financial institutions consider a wide range of income sources, such as rental income, income from investments, savings accounts and many other things.
Therefore, if borrowers add all these sources of income, they can easily increase their total monthly earnings, excluding salary and qualify for a personal loan.
Apply for a low loan amount
A borrower’s monthly income plays a crucial role in deciding his/her repayment capability. For applicants with low monthly salaries, the best is to opt for a low principal amount. This way, the financial institutions can approve the application without worrying much about defaults.
Add a co-applicant
Borrowers with low income can consider adding a co-applicant and jointly applying for this financial product. The lending institution will consider the income of both these applicants.
Also Read : Check Out 10 Best Personal Loans in India 2022
Along with that, they will assess the credit and debt, which will ultimately boost the personal loan application and borrower’s profile. Adding a co-applicant will help a prospective borrower secure the loan with favourable terms and rates.
Things to consider before applying for a personal loan with a low salary
Borrowers with low salaries must keep in mind these factors before applying for the same-
Since individuals are applying for low salary personal loans, they must know the eligibility criteria to reduce their chances of loan rejection further. Therefore, borrowers must check the eligibility criteria of various lenders and select one offering easy-to-meet parameters.
The interest rate decides the total cost of borrowing. Lenders provide the best rate to borrowers with high income rather than ones with low income. Here, market research and the following strategies can help borrowers get affordable interest rates.
Borrowers struggling to get personal loan approval can follow the above-mentioned strategies to easily qualify for such financing.
Application process of low salary personal loan
Follow the steps mentioned below to apply for a personal loan:
Step 1 – Visit the official website of a preferred lender
Step 2 – Click on ‘apply online’ to get the application form
Step 3 – Enter mobile number and obtain OTP
Step 4 – Provide essential details and select the loan amount
Following this, a representative from the lender’s end will connect and take the application forward.
Currently, various lending institutions have introduced quick loan app to make the loan application and approval process even faster.
Further, several reputed financial institutions also extend pre-approved offers to quicken the loan application process. These offers are available on a wide range of financial products, such as personal loans, business loans, credit cards, etc. Individuals can check their pre-approved offers by entering names and contact details.
Features of personal loan
As unsecured financing, personal loans help individuals cover personal as well as emergency expenses without any hiccups. Lenders provide personal financing on the basis of income level, repayment capacity, credit and employment history.
The features of personal loans for low-income applicants are discussed below:
One of the major benefits of availing personal loans is the minimal document requirements during loan processing. Borrowers with low salaries need to submit only KYC documents, bank statements for the previous three months, salary slips for the last two months and photographs to get a loan instantly. However, these requirements are lender-specific.
High loan amount
In most cases, the loan amount sanctioned through personal loans is high. Therefore, individuals can take these high-value quick loans to cover marriage-related expenses, fund family vacations, child’s education, or even purchase the latest electronic gadgets. In addition, they can take a personal loan for debt consolidation.
While applying for personal financing, individuals with low salaries need not wait for days to get confirmation on personal loan approval. Here, borrowers need to fulfil certain eligibility criteria, after which they can get loan approval in 5 minutes.
Individuals willing to apply for an instant personal loan can get the loan amount disbursed on the same day of approval. Thus, managing urgent cash requirements will not become an issue as you can use a personal loan to pay off your medical debt.
Flexible repayment tenor
Personal loan applicants can choose a repayment tenor of up to 5 years. This extended repayment period helps manage personal loan EMI repayment efficiently.
Now that individuals know the important features of personal loans, they must learn the application process.
From the above discussion, individuals can understand that earning a low income will not disrupt availing a personal loan. Further, the chances of approval of low salary personal loan increases when borrowers adopt the strategies mentioned above.
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