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WHICH OF THE FACTORS DETERMINE YOUR LOAN APPROVAL?


The popularity of loans has accelerated in the recent times due to great features associated with these services. Nowadays, many lending and financial institutions are offering different loan products unique features and latest benefits to the borrowers. In such modern world, keeping up with the trending lifestyle has given a boost to loans and with the rise of digitization it has become easy to access the funds to fulfill your financial needs.

A borrower can "Apply For Loan" to fund their needs such as home renovation, wedding expenses, travel, medical bills etc. When you avail any loan, there are number of factors that determine your loan approval. Amongst all, income is one of the key factors that directly impact your approval on loan as it reflects your repayment capacity to pay back the loan. Moreover, you can plan your installments according to your income with other financial goals.

There are some other factors than salary that determine your loan approval which are listed below:

  • Credit Score: It is the popular term used by the lenders that indicate your capacity to repay the loan. A good CIBIL will increase your chances of approval on desired loan amount as compared to low credit score. Therefore to ensure your approval, it is good to check your credit score for loan eligibility. Never check your credit score with multiple lenders as it affects your credit score adversely and reduce the chances of loan approval.
  • Work stability: When you have any work experience in a reputed company, lenders will do the background check of the borrower which means if you have a stable income, your chances of loan approval are high whereas if you have shorter span or irregular work experience will impact your loan money as well as hinder your approval on loan application.
  • Age: Being a borrower, you also have certain age criteria to fulfill for accessing the loan money. Most of the lenders have minimum age criteria between 21 and 60 years of age. Usually, an individual in this age bracket is of working age and is highly preferable by the lenders due to growing salary as it indicates good repayment capability.
  • Repayment period: It is all in borrower’s hand to "Apply For Loan Online" or offline whether at short-term or a long-term. Both the situations have different impacts and repercussions on the loan. Typically, a short term loan has a lower rate of interest where as a long term loan may charge you high rate of interest.

Hence, loans are easily available as various lenders in the market are offering instant and pay day loans. However, there are great chances of misunderstanding the terms and misusing the loan money which can lead you into debt trap. Being a responsible borrower, you should access the loans whenever they are highly needed and you are short of cash. In addition to that, you must fulfill the eligibility criteria to know the chances of approval and then understand the loan terms wisely to avoid any debt trap.


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