5 Factors that Decide the Eligibility Criteria of a Personal Loan

Every time we require money to address our immediate requirements, we try to borrow some money from our friends or relatives. But what about those situations that need instant cash that too in a good amount? Can you get Rs 5 lakhs within hours? May be or may not, as it totally depends on the way you take to fund your need. However, you can get a personal loan, but you need to follow a proper process to get a loan. And if you are not aware of the process, you can look at these factors which are crucial to define the eligibility criteria of a personal loan and smoothen your loan application process.

Your credit score

A credit score is a three-digit number that a lender looks and decides whether a loan or a credit card can be given to a person or not. The score is calculated by the agencies based on your past credit behaviours.  The credit score ranges between 300-900. However, a credit score equivalent to 750 or more is considered an ideal credit score to avail the loan.

Those who do not have a good credit score, can be denied for any kind of credit be it a personal loan, car loan or credit card. A bad or poor credit score sends a message to the lender that borrower was irresponsible towards managing his past credits. In simple words, if you’ve failed previously while paying the loan, then your credit score could get a jolt and it would show in your credit report. So, if you are planning to take a personal loan and your credit score is good, chances are you will get a personal loan easily.

Your repayment history

The repayment history is a record of all your past and present payments made to the lender. It includes all the data related to timely payments, late payments, and missed payments. This helps a lender monitor you as the borrower. For instance, if a borrower has a repayment history full of missed payments and late payments, is enough to gauge a borrower that there is a lot of risks involved in lending any kind of loan to the borrower. On the other hand, if a borrower has a clean payment record, it suggests that the borrower is responsible and he can be given a credit. However, a bad repayment history doesn’t affect the application directly, but it impacts the credit score negatively. Thus, chances increase to get disapproval for the submitted loan application.

Employment stability and employer’s reputation

On the basis of the company profile, the banks and lending institutions have categorized companies into listed and non-listed companies. Based on this segregation, the lenders decide whether an employee is working with a listed company or non-listed company. The employee of a listed company considered a stable employee working with a credible employer. Therefore, the bank offers some relaxation or good offers to the employee working with a top-rated company. On the other hand, an employee working with a less credible or non-listed company either gets a loan at a higher interest rate or denied any kind of credit. For instance, Fullerton personal loan interest rate ranges between 12.99% to 36%. So, if you apply for Fullerton personal loan online and you are working with less credible employer you may get a loan at a higher interest rate. Also, the one who continuously hunts for a job or changes the job frequently brings a threat to the lender, hence, gets rejections.

Your income 

A salaried or a self-employed person may get a personal loan. When a person requests a personal loan via a financial institution, the lending institution sees how much is a person earning. By looking at the income, a lender decides whether a person can repay the loan. That’s why some lenders have pre-defined eligibility criteria to qualify for a personal loan. For a borrower, it is important to understand that if you have other sources of income to back your loan application, reveal it as it increases the chance of availing a personal loan. Assume you apply Fullerton personal loan online and your monthly income is Rs 20000, you can avail a personal loan easily.

Your age

Most banks follow pre-defined eligibility criteria in terms of age. They usually offer a personal loan for the person between the ages of 23 and 55 years. An aged or a minor person seems to be dependent on others. As a result, banks do not entertain loan applications from such individuals. Generally, in India, a person below the age of 20 years is considered incompetent to avail a personal loan. The individual is known to be a student or in the learning phase as he spends mostly on learning. Since the individual is not earning anything to support his financial needs, a lender may deny him for a personal loan. On the other hand, the person of 55 years considered as a senior citizen, and dependent on others for the financial requirements, can’t bear any kind of personal loan. However. If a retired person is drawing pensions, he can get a pension loan over his pension. For example, to get a Fullerton personal loan, the applicant’s age should be between 21 and 60 years.


Before the personal loan application, a borrower needs to look at many factors responsible for qualifying for a personal loan. Being a smart borrower, check your credit score, monthly income, and the age at the time of applying for a personal loan. If you are working with a credible employer and you are stable in your job, you can get a loan easily.

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