Getting a personal loan can be a smart good way to handle unexpected financial needs. Be it a medical emergency or a big-ticket purchase, a personal loan can come to your aid. The thing about these unforeseen expenses is that they can hit you anytime and it is always wise to be well-prepared for all the curve balls that life might throw. One way to be future-ready is knowing your eligibility for a personal loan and taking cohesive measures to increase this eligibility over the years. So, that when the time comes for you to seek financial aid, you know whom to go to and how much you can borrow.
You can easily check your personal loan eligibility through personal loan apps. Here is what you need to do –
4 Ways to increase your eligibility for personal loans
- Choose a personal loan app:
The advent of smartphones, high-speed mobile internet as well as online identity authentication and protection services as well as new financial technologies has given rise to the concept of a personal loan app. Almost all conventional lenders still rely on age-old methods and formulae to determine what is the credit worthiness of a person. Thus, they tend to offer lower personal loan eligibility even if someone has a stellar credit score. A personal loan app relies on all those factors but also supercharges them with the use of advanced artificial intelligence algorithms, neural networks and machines learning. This is the reason why an app-based lender will always be able to provide higher loan eligibility because they are assessing your credit worthiness in a much better manner. Moreover, conventional lenders have very high operational costs which is not the case with an app based personal loan online. As a result, an app based lender will offer higher loan eligibility almost every time.
- Show your investments and assets
When a lender is providing you with a loan, they are doing so based upon your current income. The concept here is that they have to lend you money in such a way that they do not run a lot of risk while also ensuring that as per your current income levels you will have enough leeway to pay your EMI and have money left for your own expenses like food, clothing, housing transportation etc. One good way to get higher personal loan online eligibility is to show all your savings and investments to the lender. This will boost their confidence that you are a financially responsible person and that they are not lending into a hole. If something goes wrong, you have the means to service your debt. This confidence is what allows a lender to make larger loans and when the lenders are convinced that you are a low-risk, high-return borrower, they will give you higher loan eligibility!
- Find a co-borrower:
Finding a co-borrower is another effective way to get higher personal loan eligibility. When you take a loan alone, the lender decides the limit only based on your assets and income. However, what is the income and assets in consideration by the lender suddenly increase a lot? This is what happens when you get a co-borrower for your loan. With a co-borrower on your side, the lender will consider your as well as your co-borrower’s income and assets to decide how much they can lend. An added advantage is that with a co-applicant on a loan, the lender also sees that their risk factor in the loan has gone down significantly. This means they will give higher personal loan eligibility on your application.
- Take a longer-duration loan
This is another method that allows you to get higher loan eligibility through a personal loan app or conventional lender. Many times, lenders may not be able to lend you the amount you need for the period you are seeking. Generally, this happens because they find that you are not earning enough to be able to support a large enough EMI. What happens if you keep your loan asking amount the same but increase the duration of the loan? Your loan becomes spread over a longer time period which means that the amount you are required to pay every month in the form of EMI goes down. Considering that lender’s concern was if you will be able to afford a larger EMI in the first place, that part has now been taken out of the question with a lower EMI amount. This means that you can now apply for a higher amount of personal loan than earlier. Instant eligibility booster!
To conclude
At the end of the day, however, the single most effective way to ensure that you are able to get and maintain higher eligibility for a personal loan is to have a stellar credit score. Always pay your EMIs on time and never ever default on any loan. Now you can enjoy high loan eligibility in every kind of credit.
