A personal loan is a simple short-term loan that could be used for any legitimate purpose. It is an unsecured loan and won't be required to pledge any form of collateral or security. It can be used to meet immediate personal expenses like a medical emergency, a sudden loss of a job, to fund your wedding or higher studies, and finally, it can also be used as capital for business or to consolidate debt.
A personal loan has several advantages including relatively simple documentation, no need for collateral, and no restrictions on how you use the money. However, it comes at a high-interest rate, so it is advisable to have a good credit score before applying for it.
What is a pre-approved personal loan?
A pre-approved Personal Loan is usually offered by banks to customers who have a clean track record of repaying their dues. It is often offered at lower interest rates.
Some lenders pre-approve a loan to their customers even if they have no credit history based on parameters like income and savings history. It is often a limited period offer.
There are several advantages to a pre-approved personal loan. They require less documentation, and it is processed within a few days. You could check with your lender if you are pre-approved for a loan offer, or you could log into your net banking account and see if you are pre-approved for a loan. Do keep in mind the final approval depends on your credit history and the lending policies of your lender.
Key Features of Pre-Approved Personal Loans
• Simple application procedure
• Fast Processing
• Almost zero paperwork
• Preferential interest rates
Pros of a Pre-approved Personal Loan over other Loans
• Complete flexibility of end-use
• Flexible repayment options, with tenures ranging from 12 months to 60 months
• No collateral required
• Loans available for various needs
• Hassle-free online loan application
• Easy and simple documentation, quick processing and speedy disbursal.
• Foreclosure facility available with most lenders
• You can easily check your eligibility online on the lender’s website
Cons of Pre-approved Personal Loans
- High-interest rates due to their unsecured nature, and especially if you have a dented credit history
- If you have a bad credit rating, then your application might get rejected, further damaging your score
- If, on the other hand, your application is approved, then it will be done so at high-interest rates which will considerably increase your monthly outgo
Can I get a Pre- approved personal loan without documents?
Several lenders like HDFC bank, Axis bank and ICICI bank (to name a few) provide various personal loan offers, which doesn't require any documentation. Some of the features are as follows:
• Instant Loan disbursal
• Paperless and online
• Nil documentation
• Special offers like a reduced interest rate
There is a catch, however. This offer is available for pre-approved customers only. If you are an existing customer, then you can check your eligibility zero document personal loan by logging into your net banking platform.
You can also avail of Instant loans if you are the holder of an active HDFC Bank credit card / ICICI Bank credit card / Axis Bank credit card. These loans are generally called instant loans, which is basically a pre-approved loan within the credit limit on your credit card. Your credit limit will be blocked and released subsequently as you pay back your EMIs.
Key Features of Instant loans:
• Nil Documentation since you are an existing customer. No hassles of documentation if you are in urgent need of funds.
• Flexible Repayment tenure
• Instant Credit – the loan amount is credited directly to your savings account
• Attractive Rate of Interest
Again, this offer is available for pre-approved customers only. You can check your eligibility for an instant loan by logging into your net banking platform.
Life is unpredictable and throws us countless situations where you might be in an urgent requirement for funds. If you don't have an emergency fund, don't panic. These options can help you overcome cash crisis if executed well.
Personal Loan – Apply Online
If you require a personal loan, you can check your eligibility and apply for one by signing up with CreditMantri. It is quick, simple and above all, free.
CreditMantri matches your credit and demographic profile to the lender's lending criteria and presents you with a shortlist of only those lenders willing to lend to you based on your unique credit profile. In effect, we pre-screen your application to make sure you are likely to qualify as per the lender's credit criteria. Hence, the chance of your loan application getting approved is higher.
Click here to sign up and apply for loans and credit cards, the CreditMantri way!
FAQs for Pre-approved Personal Loan:
- Who can get pre-approved personal loan offers?
Pre-approved personal loan offers are usually given to existing customers who have a long time relationship with the bank.
- What is the benefit of going for a pre-approved personal loan?
When you go for a pre-approved personal loan, you usually won’t have much documentation. The interest rate is also lower compared to a loan that you have applied for on your own.
- Can I check my personal loan eligibility?
Yes, you can go to your bank’s website and check your personal loan eligibility. Once you do this, the bank will automatically call you to find out more details and help you with the personal loan process.
- How long will it take to process a pre-approved personal loan?
Pre-approved loans are processed quicker than normal personal loans since the bank already has most of your information. Many banks offer instant disbursal on pre-approved personal loans.
- What is the average interest rate on pre-approved personal loans?
Personal loans usually have an interest rate in the range of 11 – 24%. The same range applies to pre-approved personal loans too.