05 JUNE, 2020

Financial crisis is an uninvited guest in the lives of many. It can happen in anyone’s life, at any point in time. When in an urgent need of funds, personal loans make for a good resort. Be it a wedding, a dream vacation, or credit card debts, you can use personal loans for any purpose. Personal loans are the most popular option when you are in a pressing need for cash as there are no restrictions on its end usage. 

If you are a customer who has a good debt repayment history, you have an added advantage that comes along with the personal loans, a pre-approval! With pre-approved loans, the process of availing a loan becomes more hassle-free with minimum paperwork. You may have even received a message from your lender saying you are eligible for a pre-approved loan. The lender offers this loan to their customers with a good credit history. 

What is a Pre-Approved Personal Loan?

Banks offer pre-approved personal loan to their existing customers who have a good track record of repaying EMI’s and debts. If you are granted a pre-approval for a loan that means you’ve already crossed the initial approval process. It is similar to other types of loans except for the fact that the lenders will directly reach out to you to lend the loan. Pre-approved loans can be used for any purpose you want to use it for.

Eligibility Criteria

Most of the banks offer this facility only for their pre-existing customers. The other factors that can determine your eligibility to avail of this loan may include a good credit score, with an excellent track record of outstanding bills. The lenders may also prefer the customers who maintain an average monthly balance, with a stable income for giving this loan. 

The complete information regarding the eligibility for pre-approved loans can be easily accessed by logging in to your net banking account. 

Application Procedure

In most cases, application procedures for pre-approved loans can be done online. You can check the eligibility for a pre-approved loan by logging in to the bank’s website. You need to select the loan amount, tenure, and accept the terms and conditions of the loan. Apart from these, you need to furnish some necessary documents such as Pan Card, Salary Slip of the past three months, ID and residence proof to get the amount credited to your account.  

Benefits of pre-approved loan

There are numerous benefits that come along with pre-approved personal loans, which are as follows:-

  • Faster loan disbursal - As you are already a customer of the bank with a good credit history, the banks will offer a speedy loan disbursal.

  • Minimum paperwork - The lenders must be already having the essential documents needed for a loan. Hence, you will be getting the loan with minimum paperwork. 

  • Affordable Interest Rates - The lenders will provide you with some affordable personal loan interest rates on the pre-approved loans as you have an excellent proven credit history. 

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Disclaimer: This Article is for information purposes only. The views expressed in this Article do not necessarily constitute the views of Kotak Mahindra Bank Ltd. (“Bank”) or its employees. The Bank makes no warranty of any kind with respect to the completeness or accuracy of the material and articles contained in this Article. The information contained in this Article is sourced from empaneled external experts for the benefit of the customers and it does not constitute legal advice from the Bank. The Bank, its directors, employees and the contributors shall not be responsible or liable for any damage or loss resulting from or arising due to reliance on or use of any information contained herein. Tax laws are subject to amendment from time to time. The above information is for general understanding and reference. This is not legal advice or tax advice, and users are advised to consult their tax advisors before making any decision or taking any action.