Financing personal loans is easier than ever today with several lending institutions providing the required funding. These loans come with high-quantum funding, which makes it possible to meet big-ticket expenditures with ease. Further, lenders keep no restrictions to end-use on these advances, which means that they are suitable for funding all types of expenses.
Be it financing your child’s education, meeting eponymous wedding expenditures, funding medical expenses, or even paying for travel bookings, the loans come off as useful. Further, as the approval comes by quick and easy, it serves right for meeting emergency financing needs of individuals as well. The unrestricted usage allows it to be utilised for business financing as well. All you need to do is meet a handful of eligibility criteria and submit the personal loan documents required for the loan processing to initiate.
It is best to be prepared with the necessary documents and eligibility fulfilment to receive easy approval of personal loans when in need. Let’s check out some common documents needed when applying for the advance.
List of Personal Loan Documents Required
To fulfil the basic eligibility criteria, you must provide a handful of documents for paperwork completion when applying for the loan. Below is given the list of personal loan documents required. That you should provide for paperwork completion.
The KYC or Know Your Customer documents are a mandatory requirement that the lender wants an individual to complete when becoming a customer with them. KYC is a crucial completion followed for any transaction with a financial institution today. Its primary purpose is to establish individual identity with the financial institution. KYC documentation was initially introduced to keep transparency in the customer-financier relationship. And also to easily track the movement of finances.
Today, KYC has become a crucial support to the entire financing fundamental for lending institutions, allowing them to better identify who the borrowers are along with keeping a record of their addresses. The following documents serve as KYC documents required for personal loan.
- Aadhaar card: It serves as a proof of identity as well as a proof of address.
- Voter ID card: It is another photo identity proof that doubles up as an address proof too.
- PAN card: A PAN car serves as an identity proof and also serves for the purpose of taxation incidences of loan repayments.
- Driving license: It is a document serving as a suitable proof of identity too.
- Passport: One can also provide their passport for commencing paperwork.
Other valid documents for the purpose of KYC completion include ration card, utility bills, etc.
Proof of occupation
When applying for a personal loan, you also need to provide a handful of documents to prove. The existence and stability of your occupation. Depending on whether you are a salaried applicant or applying for the loan as a business owner. The documents required as proof of occupation vary. Given below is the list of personal loan documents required you would need to submit for based on your occupation.
– For salaried individuals
Salaried individuals need to provide their employment ID issued by the employer to prove. Their current occupation in the job as well as to present the total years of experience as needed by the lending institution.
– For self-employed individuals
In the case of self-employed individuals, documents like incorporation certificate of the company. Memorandum of Association, Article of Association, GST Identification Number. And the likes serve suitably in establishing the business’s existence and vintage as required by the lending institution.
You also need to provide income proof as your personal loan document required for paperwork completion. The documents so provided allow the lender to assess your repayment capacity, according to which they take the loan application further. The income documents, based on the occupation of the borrower, can vary. However, some common documents you may be asked to submit include –
- Bank account statements for six previous months
- Income Tax Return filed for two/three previous years as asked for
Based on the borrowing individual’s occupation, the personal loan documents required can include the following.
- For salaried individuals: Salary slips for the last six months.
- For self-employed individuals: Audited financial statements for the last 2 years, including balance sheets and profit & loss statements.
While these are the mandatory income documents that you must provide based on your occupation. It is ideal to add other available income documents as well to complete paperwork for your personal loan. Doing so shall raise your total repayment capacity, thus allowing you to borrow conveniently and affordably. While also giving a leverage for interest rate negotiation.
Now, let’s check out the common eligibility requirements that you need to fulfil to avail a personal loan.
You must ideally be between 20 and 70 years of age to avail the advance. For salaried individuals, an age range of 25 to 60 years is applicable whereas for self-employed individuals. They must be between 21 and 70 years of age to avail financing.
Occupational stability –
For salaried applicants, a minimum experience of 6 months in the current employment is necessary. With a total employment experience of not less than 1 year. In the case of self-employed applicants, 1 year of business vintage for the current venture is a must with the total experience of running the business not being less than 3 years.
Credit score requirement –
A minimum individual and/or business credit score of 700 is necessary, as applicable to the borrower’s occupation.
Residential citizenship –
Both types of applicants must also be residing Indian citizens with a stability of not less than 1 year.
When proceeding to apply for the advance, make sure to keep all. The personal loan documents required handy to ensure hassle-free and quick loan processing. With the best lending institutions in the market, approval for personal advances comes as quick as within a few minutes of application for eligible candidates, with disbursal following within the next 24 to 48 hours.