As stated by RBI, the outstanding personal loan amount in India increased by 12.1% in August 2021, while just a year ago, its growth was 8.5% (1). Being a collateral-free credit facility, individuals can instantly meet their credit shortages after undergoing the easy loan application and documentation processes.
Getting a short-ticket Rs 5 lakh loan is even easier. For this, they only need to meet the eligibility criteria and complete the easy personal loan application form.
Online Application Process to Get Rs.5 Lakh Loan
Intending borrowers need to undergo the step-by-step guideline mentioned below to apply for a personal loan:
Step 1: Visit the official website of the lending institution
Step 2: Go to the personal loan section and tap on ‘Apply Online’
Step 3: Fill in the form with your required personal information and your permanent mobile number
Step 4: Enter the OTP properly for verifying the contact number
Step 5: Provide all the personal, income and professional information properly
Step 6: Mention Rs.5 lakh loan as your required amount
Step 7: Submit the properly filled-in application form
Upon completing all these steps, the lending institutions get the credit request of applicants. After initial verification, they get in touch with their customers through the contact number that they register during the application process. At this stage, the professionals inform them about the steps they need to follow next.
Nevertheless, before applying for the credit facility, borrowers must check the personal loan eligibility criteria of the lending institution. Lenders may reject credit requests if they fail to meet those eligibility requirements.
Eligibility Criteria for Personal Loan
Following are the eligibility parameters of this simple unsecured loan:
- Applicants need to be 21-67 years old. However, they must ensure that they repay the loan before they become 67 years old.
- They must be Indian.
- Individuals also need to have a minimum CIBIL score of 750.
- Having a minimum salary of around Rs.22,000 is also necessary. However, the income requirement may vary across the location. For instance, metro city residents may need to have a higher monthly income to be eligible for the credit facility.
Note that the above-mentioned personal loan eligibility parameters are indicative. Individuals need to find the detailed eligibility criteria by visiting the lender’s website.
Furthermore, as mentioned, individuals need to have a healthy CIBIL score of at least 750 to meet the eligibility requirements and get quick approval on their loan requests. Some individuals may not have such a credit score. Therefore, they should also need to know how they can get a personal loan if they have a poor credit score.
Intending borrowers also should be aware of what to look for while applying for Rs.5 lakh loan.
Things To Consider While Applying For Rs.5 Lakh Loan
Individuals need to be mindful of the following aspects while applying for this collateral-free loan:
- Choosing a tenor
Borrowers should determine a tenor that can give them an easy EMI on personal loan of Rs.5 lakh. With a shorter tenor, they will get a higher instalment amount. As a result, they may face inconveniences in repaying their debt.
On the contrary, when the tenor is longer, the interest rate remains active for an extended period, escalating the overall borrowing cost. They must know how they can find the right personal loan tenor that works for them.
- Knowing the instalment amount
Be it a personal loan of Rs.50,000 or Rs.5 lakh, individuals must know how much they will have to pay as instalment amount. By knowing the monthly obligations beforehand, they can make proper financial planning to repay.
Intending borrowers can easily understand their monthly payable by using the personal loan EMI calculator. They can find this tool on a financial institution’s website. After accessing the calculator, they just need to enter the values of interest rate, borrowed amount and estimated tenor to know the EMI amount payable.
- Finding the applicable charges
Individuals must keep in mind several essential personal loan charges. Besides the interest rate, these charges also contribute significantly to the overall borrowing cost of a personal loan. This is why they need to compare different loan offers against the interest rate and applicable charges. This way, they can find an offer that will reduce their cost of borrowing to a large extent.
Apart from this, several lending institutions in India extend pre-approved loan offers to their customers. These are special credit facilities that lenders facilitate on their products, such as business loan, personal loan and credit card. Borrowers can significantly quicken the loan application process by accepting these special benefits. They just have to mention their names and contact details to check their pre-approved offers.
In conclusion, a personal loan is one of the most convenient financing options to meet short-term credit shortages. Individuals can be easily eligible for a small credit amount, Rs.5 lakh loan. One of the major benefits of this loan is that they can utilise the entire credit amount as they prefer.