Most want to act and play it safe when getting a loan. It could be for any reason, but the most important thing is that you know a lot about the product or get a pre-approved loan. As a borrower, you shouldn’t choose in a hurry or because you don’t know enough. A loan already approved is suitable for both the borrower and the lender in many ways. A loan that has already been approved lets you know how much you can borrow or the most you can.
You can talk to the lender about the terms and conditions and get a better deal. It also gives you an edge when looking for a place to live. Since you already know how much you can spend, you can look for a home that is very close to your budget. If you know your budget ahead of time, you can talk to the builder or property owner in a good way. Even negotiating can help you save money. You can change the amount of your loan if you find a better deal and get pre-approved offers.
The difference between a pre-approved loan and a pre-qualified loan
With a pre-qualified loan, you can get an idea of how much money you can borrow from a lender. It’s a rough estimate of how much a bank or an NBFC will lend you, but to get a pre-approved loan offer means that the bank or lender has already looked at your credit score and credit history. Check your paperwork and bank information to approve a specific loan amount. Remember, this instant pre-approved loan is suitable for a limited period.
Here are five essential things to consider when applying for a personal loan that has already been approved.
Salary slip/proof of income:
You must show the lender proof of income to get a pre-approved loan. As proof of your income, you must give a complete bank statement showing your salary credit, bonuses, incentives, and other salary slabs. You must also send information about additional loans to offer your costs. You must also send copies of your two most recent tax returns. If you get money from something other than rent, part-time work, or a job, you should include that in your proof of income too.
Show off what you’ve saved.
This is important as no lender will give you the total amount to buy the property. In the best case, you will get up to 90% of the amount without any problems or setbacks, but most lenders will only give you 80–85%. So, you’ll need to come up with at least 15%–20% of the amount on your own. So, show off how much you’ve saved and invested in.
Good record with money
Most financial institutions give money to people with good credit scores or histories. Anyone with a credit score of 750 or higher can quickly get instant loan offers from any bank or NBFC. But people with bad or flawed credit don’t get loans for more money. Now, lenders are more careful about giving out loans. In the loan segment, they strictly follow the rules set by RBI. Try to keep good credit history, so the lender will let you borrow a reasonable amount. Don’t stop paying on a loan you have or pay your credit card bills late. In the long run, it will hurt your credit score and history.
Verification of a job
These banks and financial companies check to see if you have a job. They use your information to see if you work for that company or not. Have you given the correct information about your job status, title, salary, and total years you’ve worked for that company? They will cross-check your information with your old employer if you just changed jobs. This is also essential to the verification process, so you should never give false information here.
When you accept a pre-approved loan, your lender might ask for proof of your address, ID, age, or education. Get these things ready. If a bank or lender asks for other documents, try to provide them as soon as possible. The papers should be accurate and relevant. Getting a loan will be easier if you take charge and work with the lender.
Special offers from lenders and other major credit issuers are becoming more and more common for people who borrow money. Most of the time, these will be offers for personal loans or different types of unsecured credit for which you have already been approved. But you should know what a pre-approved loan means before you accept any of these pre-approved offers. The lender gives you a pre-approved loan based on your current financial situation. It is a product that banks or NBFCs usually offer to their existing customers who have a perfect credit history and a high CIBIL score.