What Is a Personal Loan? 

A personal loan is an unsecured loan, and you do not have to pledge any collateral to receive funds. You can approach your bank or any financial institution to apply for a personal loan. 

What Can A Personal Loan Be Used For? 

You can use the personal loan for various purposes like weddings, medical emergencies, higher education, holidaying, home refurbishment, and much more. 

What Are the Factors That Determine Your Personal Loan Eligibility?

Your personal loan eligibility is determined by some of the following factors: 

  • Credit score
  • Income
  • Age
  • Employment type 
  • Your current liabilities

What Are The Documents Needed To Apply For A Personal Loan?  

The documents needed to apply for a personal loan are: 

  • Photo ID and age proof
  • Signed application form with photograph
  • Residence proof
  • Bank statements for the last 6 months

For salaried applicants:

  • The salary slips for the last 3 months
  • Form 16 or income tax returns

For self-employed applicants:

  • Income tax returns of last 3 years with computation of income 
  •  Last 3 years CA Certified / Audited Balance Sheet and Profit & Loss Account

What Is The Minimum Credit Score Required For A Personal Loan?

It is generally required to have a credit score of 750 and above for a personal loan. The higher your credit score, the higher your chances for approval would be. Lenders will first check if your credit score is 750 or above before deciding whether to continue with the processing of your application. A credit score of 750 suggests that you are creditworthy and have made your repayments on time for a prolonged time period. 

Also Read: What is the minimum CIBIL™ score to get a personal loan