What is a Personal Loan Eligibility Calculator and How it Works

Securing a Personal Loan can be a lifesaver for meeting your various financial needs, whether it's funding an emergency, covering medical expenses, or making a big-ticket purchase. However, before applying for a Personal Loan, it's crucial to understand whether you qualify for one. This is where a Personal Loan Eligibility Calculator comes in. So, let’s get started!

How is Personal Loan Eligibility Calculated 
 

Your eligibility for a Personal Loan depends on multiple factors, including your repayment capability, credit score, employment status, age, and existing financial commitments. Since different lenders have different criteria and credit score benchmarks, it’s important to understand what they require. Generally, maintaining a credit score of 750 or higher significantly improves your chances of securing approval, as it reflects strong financial responsibility. By assessing these aspects, lenders determine whether you qualify for a loan and the terms that may apply.

Benefits of Personal Loan Eligibility Calculator

Here are some benefits of a Personal Loan eligibility calculator you must know:
•    Quick Assessment: Instantly provides loan eligibility details without manual calculations
•    Accurate Estimates: Helps you set realistic expectations based on your financial profile
•    Better Loan Planning: Adjust the loan tenure and amount to align with your repayment capacity
•    Time-saving Tool: Eliminates the need for repeated discussions with lenders before applying
•    Improved Approval Chances: Refine your eligibility before formally applying and reduce the risk of rejection

Factors Affecting Your Personal Loan Eligibility

Here are some factors that affect Personal Loan eligibility: 

1.    Income: One of the most important factors lenders look for is your monthly income to ensure loan repayment capability. A stable source of income gives an assurance to the lender that you can repay the loan and thus, can increase your chances of loan approval.  
2.    Credit Score: A credit score represents your creditworthiness and is calculated based on your credit history. A higher score indicates that you are a responsible borrower and can help you get a lower interest rate and favourable terms. 
3.    Age: Most lenders require applicants to be within a specific age range but in general you must be between 21 to 60 years. 
4.    Work Experience: A longer work experience indicates better job stability and makes you seem more reliable to the lender. 
5.    Existing Debt: If you have any current liability or debt, it can increase your debt-to-income (DTI) ratio. Hence, it is always advised to have a DTI ratio under 30%. Having a higher DTI ratio can reduce your chances of loan approval or limit the loan amount. 

How to Use Personal Loan Eligibility Calculator

Using a Personal Loan eligibility calculator is simple. Here are some steps you must follow:
Step1: Go to Poonawalla Fincorp website and click on the loan section to select Personal Loan dropdown. 
Step 2: Click the “Eligibility Calculator” from drop down. 
Step 3: Select your qualification, loan tenure, monthly salary, and other EMIs and click on the apply button.
Once you click on the apply button the eligibility calculator will display the loan amount you are eligible for. 

To Conclude

A Personal Loan eligibility calculator is an essential tool for assessing your loan eligibility before applying. By analysing key factors such as income, credit score, and age it provides you an accurate estimate of how much you can borrow. This tool simplifies the loan application process by helping you understand your loan eligibility and enabling you to make informed decision-making and enhancing approval chances. 
Now, apply for a Personal Loan confidently by checking your eligibility using Poonawalla Fincorp’s Personal Loan eligibility calculator.

Frequently Asked Questions

1. What is a Personal Loan Eligibility Calculator?

A Personal Loan eligibility calculator is an online tool that helps you determine your eligibility for a loan by assessing factors such as income, credit score, age, and financial obligations.

2. What factors affect Personal Loan eligibility?
Factors like income stability, credit score, employment type, age, existing debts, and financial obligations impact loan eligibility and approval chances. 

3. What credit score is needed for Personal Loan approval?
A credit score of 750 or above improves the chances of loan approval. However, different lenders may have varying score requirements, so make sure you check this before you apply for one.