Pre-approved Loan – Meaning and how to get one
- Banks offer Pre-approved loans to customers earning high income, capable of repaying debts on time.
- A good credit score increases your chances of getting a pre-approved loan.
- Steady income and timely repayment of existing debts help obtain pre-approved loans.
- Check if you are pre-approved for a loan on your internet or mobile banking platforms.
- Pre-approved loans require minimal documentation and are processed speedily.
In India, you can obtain two types of loans – secured and unsecured loans. Secured Loans require you to offer collateral or security against the borrowed money, whereas unsecured loans are collateral-free. Personal Loans and credit cards are widely known as unsecured loans. Personal Loans are the best when it comes to financing short-term expenses. Banks sometimes offer Pre-approved Personal Loans to customers. This article explains Pre-approved loans in detail.
What Is Pre-Approved Personal Loan?
A Pre-approved Personal Loan is a loan that banks offer their existing customers with a clean track record of debt repayment. Being a pre-approved customer means that the bank has approved your loan with minimal documentation. All you need to do is place the disbursement request, and the bank instantly credits the loan amount to your bank account.
How To Get Pre-approved For A Loan?
To qualify for a pre-approved Personal Loan, you must fulfil the following eligibility criteria:
- Debt Repayment History: Timely repayment of previous and existing dues shows the bank that you can repay loans, and the same would continue for any future loans.
- Clean Credit Score: A clean and healthy credit score comes with disciplined loan repayment practices.
- Steady or Increased Monthly Income: A steady net monthly income indicates stable loan repayment abilities. It helps if your lender and salary account provider is the same bank.
- Relation with the Bank: Having an existing relationship with one bank for all your financial needs gives you the leverage to obtain pre-approved Personal Loans. For instance, family or business accounts and fixed deposits make obtaining pre-approved loans incredibly easy.
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Pre-approved Loan Application Process
Follow the below Online Direct Application process for pre-approved loans
- Log into your internet or mobile banking account.
- Fill the online application form and submit the scanned copies of the required documents.
- Once your loan is pre-approved, you can select the disbursal amount and tenure.
- The bank will credit the amount into your savings account instantly.
You can contact your relationship manager or call the customer care helpline for assistance with the loan application process and get preferential Personal Loan interest rates.
Features & Benefits
Having explained what pre-approved loan means, let us assess its benefits:
- Hassle-free paperless documentation: The physical documentation required for Pre-approved loans is inexistent. Just submit scanned copies of your ID proof, income and address proof along with your PAN Card to obtain the loan.
- Shorter Processing Times: Pre-approved customers enjoy faster loan approval and disbursal.
- Collateral Free: Pre-approved loans are Personal Loans, and like all Personal Loans, you need not pledge any collateral.
- Flexible Tenures: You enjoy flexible loan repayment tenures with easy Equated Monthly Instalments.
Banks proactively offer pre-approved loans to customers who they believe can repay the loan on time. Pre-approved loans indicate that you have a good credit score and a clean track record. You can obtain these loans to finance contingencies and leisurely expenses.
Download the digibank mobile app on your smartphone. Launch the app and click on the "Get Personal Loan" link on the login page
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*Disclaimer: This article is for information purposes only. We recommend you get in touch with your income tax advisor or CA for expert advice.