Personal-loan eligibility depends mainly on your income, credit profile and existing EMIs. Knowing how lenders assess these factors helps you apply for the right amount and avoid rejections.
Key takeaways
- Most lenders want net income above a minimum (often ₹15,000–₹30,000 a month for salaried) and a stable job.
- FOIR (total EMIs ÷ net income) is usually capped around 50–60%.
- A credit score of about 750+ improves approval odds and pricing.
- Multiple applications in a short time can reduce your chances.
Typical eligibility criteria
| Criterion | Salaried | Self-employed |
|---|---|---|
| Age | ~21–60 years | ~25–65 years |
| Income | Minimum set by lender | Minimum ITR income |
| Work stability | 1–2 years total experience | 2–3 years in business |
| Credit score | ~700–750+ preferred | ~700–750+ preferred |
| Documents | Salary slips, bank statements, KYC | ITR, financials, bank statements, KYC |
How much can you borrow?
Lenders first compute the EMI you can afford:
Max EMI = (Net income × allowed FOIR) − existing EMIs
Example: net income ₹80,000, FOIR 50%, existing EMIs ₹12,000
- Allowed EMIs = ₹40,000 − ₹12,000 = ₹28,000
- At 13% for 5 years, a ₹28,000 EMI supports a loan of about ₹12.3 lakh.
Ways to improve eligibility
- Close small loans or card balances before applying.
- Add a co-applicant with income (where allowed).
- Choose a longer tenure to reduce EMI — but mind the total interest.
- Apply with your salary-account bank first.
- Correct errors in your credit report.
Common reasons for rejection
- Low score or recent defaults
- High FOIR
- Unstable employment or employer not listed
- Incomplete or inconsistent documents
- Too many recent enquiries
Your action checklist
- Check your credit report and fix errors at least a month before applying.
- Get the Key Fact Statement (KFS) with APR from at least two lenders.
- Keep total EMIs within about 40–50% of take-home pay.
- Read prepayment, foreclosure and penal-charge clauses before signing.
- Save the sanction letter, KFS and repayment schedule; collect the no-dues certificate when you close.
FAQs
Can I get a personal loan without income proof?
Most regulated lenders need income proof; pre-approved offers may rely on bank data.
Does a co-applicant help?
Yes, their income can be considered, but they share responsibility for repayment.
