A Quick Guide to Know About Pre-approved Personal Loan

Personal loans are unsecured credits that you can avail of during emergencies. These loans are designed for quick lending cash, and hence they do not require you to pledge any collateral or security. This short-term credit can be availed at a range of Rs 500 to Rs 25 lakhs easily. Many use personal loans to merge different debts and club it as one to lower their cumulative interest and not miss the timelines.

What Is a Pre-Approved Personal Loan?

Personal loans are themselves called quick loans or instant loans. Pre-approved loans are even quicker. As the name suggests, the pre-approved loans are approved. It is offered only to select customers who have already passed the initial approval process. The financial institutions check your credit history, credibility, and financial standing to offer you pre-approved loans.

It Is also to be noted that lenders offer pre-approved personal loans for a fixed loan amount and a fixed tenure. Hence you will need to clarify this with your lender before going for one. 

How Can I Know If I Am Eligible for A Pre-Approved Loan?

Usually, the financial institutions notify you if you qualify for a pre-approved loan. Usually, you are a long-standing customer with an excellent financial track record, punctual repayment history, good credit report, and a certain monthly income that meets the lender’s eligibility. You will be called and offered pre-approved loans.

You can also check with your lender through thor online portal or customer service to understand if the offer is available to you.

Documents Needed for Pre-Approved Loans

  • Photo ID proof like Aadhar card, Pan card, Driving licence etc
  • Passport size photograph
  • proof of residence like utility bills, voters ID, Aadhar card etc
  • proof of income like a bank statement, salary slips, form 16, recent IT returns etc.
  • Additionally, the documents asked vary based on your lending institutions. Hence contact your lender or check their website to understand the documents required in detail.

What Are the Benefits of a Pre-Approved Personal Loan Offer?

  • Lower Interest Rates

The pre-approved loans have lower interest rates than usual personal loans. The cheaper interest rates are because the lender has selected you after evaluating your financial standing and credit history. Hence, they will offer you the most competitive interest rates in the market.

  • Flexible Use

Pre-approved loans do not come with usage restrictions. One can use it for endless personal reasons, be it a wedding or travel or buy a new gadget. It is the borrower’s prerogative to use it the way they want.

  • Flexible Repayment Tenures

Pre-approved loans offer you Flexible repayment tenures. You can avail of a flexible repayment tenure from 12 months to 60 months based on your convenience.

  • Quick Processing and Disbursal

The application is processed swiftly as your loan is already pre-approved by the bank. Hence it takes only minutes to hours for the bank or NBFC to disburse the loan amount to your account.

  • Minimal Paperwork

The loans applied online require minimal or no paperwork. Hence the entire process is hassle-free and quick. Additionally, since they are verified using a digital verification process, the loans are verified within a day and the funds are disbursed within 30 minutes of approval.

How To Apply for A Pre-Approved Personal Loan?

Pre-approved loans can be applied using the lender’s app or website. Check for eligibility of the loan by logging into the lender’s website checking eligibility criteria. Additionally, check for your eligible loan amount using the personal loan eligibility calculator from the online portal of your finance partner. 

  • Keep the documents ready for the loan.
  • Calculate your personal loan EMI and plan your monthly installments and tenure before applying for the loan.
  • Install the instant loan app and select loan amount tenure, upload documents and accept terms and conditions. 
  • If your documentation is done perfectly, the amount will be credited to your bank account in 24 hours.
  • It is to be noted that pre-approved loans are specific period offers valid for a certain period. They are an invitation to apply within a time limit.
  •  Enquire about all the miscellaneous charges before availing of the offer. 
  • Enquire particularly about prepayment charges and preclosure charges to know if their offer is suitable for you. 
  • Compare all other lenders and the interest rates they offer before making the decision. That way, you can understand and negotiate if the offer is most beneficial to you.