What is Pre approved Personal Loan?

Pre approved personal loan is a type of loan that is given to borrowers before their credit score has been determined. This means that the lender does not have to wait for your credit score to be updated before approving or denying your loan. This can save you time and money.

Pre-approved loan

Pre-approved Personal Loan is nothing more than an unreliable short-term loan that banks and NBFCs can use for individuals with a decent credit score. Unlike normal personal loans, however, the banks and NBFCs themselves extend these offers to their customers. It is generally offered to persons whose creditworthiness is acceptable to the lending institution.

Eligible for qualifying

Long-term clients of a lending institution who meet the following requirements are normally offered a pre-approved personal loan:

• An over-average loan value
• A strong balance of the bank
• A proven record of savings
• A decent turnover
• A documented history of repayment

When you want to test if you are qualifying for an existing bank loan, you can do so by logging into your net banking account.

Necessary documentation to receive this loan

Since a pre-approved offer is only open to current bank customers, the procedure is straightforward with little to no paperwork. Moreover, if you apply for a previously approved loan with a bank other than the one with which you hold an account, you must submit the following documentation for the processing of your loan:

• Bank statements for the last six months
• Payment slips for 3 months
• Evidence of identification
• Answer proof
• PAN

Why should you apply for an approved loan?

The option of a pre-approved loan has its advantages. Let’s think about a couple, shall we?

Fast process and disbursement

As your bank has already completed your creditworthiness test, a pre-approved Personal Loan is processed quickly, possibly in minutes. And your loan amount will also be credited instantly to your account.

Strong rate of interest

Also, since these loans are issued by banks themselves, the most favorable interest rate would certainly be achieved.

Further reading: how to achieve a decent interest rate on a personal loan

Flexible

These loans are very versatile both in terms of repayment and use. You can use the fund to do whatever you want. Therefore, you can select pocket-friendly reimbursement tenures up to 60 months.

Application for a pre-approved loan

When you receive an offer via SMS or call, you simply have to respond to the same thing you need to start processing your loan requirement. You may also contact your representative of the bank to start payment.

You can also check your eligibility and request a pre-approved loan via your net banking account. Here is how to do it:

Sign up for your net banking account

Go to the ‘lending’ section and select the option ‘pre-approved loans’

Click on the button ‘Apply now’

Pick your desired loan form from the pop-up window to proceed

Complete the information needed and submit the form.

Perfect for information

Now that you’re up to date on pre-approved personal loans, here’s a few tricks about the same for you:

Pre-approved deals are generally an invitation-to-apply deal, and only for a certain duration are valid. You must apply for the deal within the specified time span.

Because the most favorable interest rate is offered, you do have to consider the other business loans before making the bid.

There can be costs associated with the loan, such as pre-closure and advance payment charges. Until applying, inquire about this.

For those loans , banks can deduct a processing fee. To stop this, you should request zero transaction fees. This decision, however, rests with your bank alone.