Personal Loan Eligibility Calculator
Calculate the Personal Loan amount you are eligible for
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Personal Loan Eligibility Criteria
- Age - 23-60 years
- Work Experience: Minimum 2 years of work experience with 1 year in the same company.
- Loan Tenure - 1 year - 7 years
- Profession: Salaried professions or business owners withdrawing a fixed income from their own company.
Factors that Affect Personal Loan Eligibility
Your Monthly Income
Your Monthly Income: The net monthly income (NMI) you draw is one of the most important factors that most lenders consider when approving or rejecting your loan application. While the minimum monthly income for loan eligibility is Rs 15,000 per month, an income above this level does not guarantee a loan. It depends majorly on your debt to income ratio. You can also club the income of your spouse or a relative and apply as a co-applicant to increase your chances of getting a loan. When using a personal loan EMI calculator, you can put in your income to find out the amount of loan you are eligible for.
Your Credit Score
Your Credit Score: A credit score is a three-digit score, between 300 and 900, that defines your credibility to the lender. The score takes into account your past loans repayments, your credit card payments, your bill payments and other such things to define your score. A score above 700 is usually considered good.
Your Employment Status
Your Employment Status: Another eligibility criterion that plays a crucial role in getting the loan application approved is the employment status. This includes a few factors such as
- The reputation of the company you work in: Lenders usually prefer applicants that work in big corporations or government organisations.
- Total work experience in the company: The odds work in your favour if the organisation has employed you for at least more than 1 year at the time of loan application and you have a total work experience of more than 2 years. If you’re applying as a director/owner of your own company, a minimum experience of 2 years in the company is usually considered good.
Your Age: Lenders usually grant personal loans to applicants that are aged between 23 and 60 years of age. If you’re nearing 60, at the time of applying for a loan, it may have a negative effect.
Existing Relationship with the Lender
Existing Relationship with the Lender: If you already have an existing relationship with the lender in the form of a loan that is already running or you have bought a product, it may increase your eligibility. Don’t forget to check the box while determining your eligibility using a personal loan calculator.
What are the Interest Rates and Tenure?
Fixed Interest Rate: In this, the interest rate remains unchanged throughout the loan tenure. Thus, the EMI remains the same throughout the tenure.
Floating Interest Rate: The interest rate may increase or decrease depending on the market conditions. Since the interest rates can change during the tenure, the EMI may also subsequently increase or decrease.
Another important point to consider when looking at the interest rate is how it’s calculated. There are two ways in which the interest rate might be calculated.
Flat Rate Method: The interest is calculated on the total loan amount for the entire duration and added to the principal amount. The cumulative amount is then divided by the number of months of the loan tenure.
Reducing Balance Method: In this, the interest is calculated on the remaining balance each month. With every EMI, a portion of it goes towards paying the interest and the rest towards the principal. As the principal reduces, so does the interest outgo.
Most lenders usually use the reducing balance method for interest calculation. It is essential to determine the total interest outgo before applying for a loan. Using the lender’s personal loan interest calculator will give you a clear idea of the total interest outgo on the loan amount based on the interest rate and the tenure.
How is Personal Loan eligibility calculated?
Debt to Income Ratio: This ratio is your total EMI payments in a month divided by the total monthly income. A debt to income ratio of more than 50% may not work in your favour when applying for a loan.
Monthly Income Method: Sometimes, the lenders may also just determine an applicant’s eligibility based on their net income in a month. Typically, lenders grant loans of up to 30 times the monthly income of an individual. For example, if you have an income of 25,000 per month, you can be eligible for a personal loan of up to Rs 7Lakh approximately.
Know Your EMIs and Available Repayment Options
Personal Loan Eligibility Calculator FAQs (Frequently Asked Questions)
How to Qualify for a Personal Loan?
Individuals above the age of 21 and maximum 60 years can apply for personal loan.
What is the Minimum Salary Required for a Personal Loan?
For salaried individuals, the salary required to avail a personal loan is above Rs. 15,000. However, a self-employed individual needs to have a stable monthly income in order to borrow a personal loan.
How Much Personal Loan You Can Get on Your Salary?
Your monthly salary is evaluated and basis that your loan amount is decided.
What is the Maximum Age to Avail a Personal Loan?
The maximum age is 60 years.
What is the Personal Loan Eligibility for Salaried Employees?
Age should be above 21 and below 60 with minimum salary of Rs. 15,000
How Can I Check My Eligibility for an Unsecured Loan?
Click on the eligibility calculator, select your city and fill in the required details.
Can I Avail a Personal Loan if I Require Funds for Business Needs?
A personal loan can be availed for multiple purposes. Therefore, if you require funds for your business, then you can borrow a personal loan.
DisclaimerThe information contained herein is generic in nature and is meant for educational purposes only. Nothing here is to be construed as an investment or financial or taxation advice nor to be considered as an invitation or solicitation or advertisement for any financial product. Readers are advised to exercise discretion and should seek independent professional advice prior to making any investment decision in relation to any financial product. Aditya Birla Capital Group is not liable for any decision arising out of the use of this information.