How Much Personal Loan Can You Get Based on Your Salary?
Banks and financial institutions offer personal loans to help you meet your personal financial requirements at times of need, thus helping you meet the uncertainties of life. But a question that bothers many of the applicants very often is how much personal loan can I get on my salary?
In many cases, these institutions consider the salary as an important tool to calculate your eligibility for getting personal loans. Your salary serves as your regular source of income, and thus, it forms the basis of your credibility for making the timely repayment of the amount of loan. So, the claim for a personal loan depends upon the fixed obligation income ratio.
The following table shows the debt-income ratio and is followed by the method to calculate the same.
|Salary||Expected Loan Amount|
|Rs. 20,000||Rs. 5.40 lakhs|
|Rs. 30,000||Rs. 8.10 lakhs|
|Rs. 40,000||Rs. 10.80 lakhs|
|Rs. 50,000||Rs. 13.50 lakhs|
|Rs. 60,000||Rs. 16.20 lakhs|
How to Calculate Debt to Income Ratio?
The debt-to-income ratio is basically a calculation of all your monthly debt payments divided by your gross monthly income. Your monthly debt repayments include all your existing loan EMIs as well as credit card EMIs. Your gross monthly income is your monthly salary which you get after all tax deductions.
Debt: Income = Gross Monthly Debt : Gross Monthly Income
Take a look at some of these possibilities.
|Salary||Existing EMI of Rs. 3K||Existing EMI of Rs. 5K||Existing EMI of Rs. 8K||Existing EMI of Rs. 10K|
|Rs. 20,000||Rs. 4.08 lakhs||Rs. 3.60 lakhs||Rs. 2.88 lakhs||Not applicable|
|Rs. 30,000||Rs. 7.70 lakhs||Rs. 6.00 lakhs||Rs. 5.50 lakhs||Rs. 4.80 lakhs|
|Rs. 40,000||Rs. 8.88 lakhs||Rs. 8.40 lakhs||Rs. 7.68 lakhs||Rs. 7.20 lakhs|
|Rs. 50,000||Rs. 11.28 lakhs||Rs. 10.80 lakhs||Rs. 10.08 lakhs||Rs. 9.60 lakhs|
|Rs. 60,000||Rs. 13.68 lakhs||Rs. 13.20 lakhs||Rs. 12.48 lakhs||Rs. 12.00 lakhs|
*Note: For exact figures, one must use the personal loan eligibility calculator.. These were a few points that bring out the relationship between the dependency of personal loans on the salary of the individual.
The eligibility of availing the benefit of a personal loan actually depends on a perfect combination of certain factors, and one can easily get the approximation using the personal loan eligibility calculator available on various sites.
- Your monthly income
- Your credit score
- The age of the borrower
- The work experience of the borrower
- The current liabilities
- Employer’s status
If you are planning to get a personal loan, then you should be able to prove your credibility to the lenders. The personal loan can only be approved if the lenders find you eligible for the loan. Though the eligibility criterion differs among the different lenders, yet the basic conditions are almost more or less the same. In order to get a quick loan sanctioned at nominal rates of interest, one must be able to satisfy the eligibility requirements.
- Your Monthly Income:
The monthly income of the borrower forms an important factor in ensuring the lenders about your capacity of making timely payments. The income requirements may usually vary according to the areas or locations, just like, it is generally higher in metro cities as compared to other urban areas and small cities.
It’s obvious that individuals with high incomes are more likely to repay their loans on time than those with lower incomes. So, the lenders levy high-interest rates on loans given to low-income groups, and this is done to safeguard themselves against potential risks.
- Your Credit Score:
Lenders check your credit score before approving any loans as good credit scores indicate a higher probability of the loan being repaid promptly. Higher credit scores indicate better degrees of creditworthiness and hence lenders prefer to lend to those borrowers with credit scores above 750.
- The Age of the Borrower:
The applicant's eligibility criteria differ for salaried as well as self-employed individuals. age must range between 21 to 60 years.
- The Work Experience of the Borrower:
The applicant must be an employee of a private or a public enterprise with a basic minimum turnover as per the company policy. The applicant should have a minimum of 1-year experience and 6 months in the present company.
- The Current Liabilities:
You might have a high income, but if you are already paying too many EMIs or huge credit card bills out of that income, there will be little left to pay EMIs for loans available in the future. The preferred range of combined EMIs to Income Ratio is between 40-60%.
- Employer’s Status:
As we know that personal loans are unsecured loans, the lenders need to build trust in borrowers, and the reputation of your employer is one among those various factors. Sometimes the copies of salary slips are also sought to be attached with the documents filed for getting a personal loan.
How Much Personal Loan Can I Get on My Salary from Money View?
Money View offers personal loans in the range of Rs 5,000 to Rs 5,00,000 subject to the basic eligibility criteria as mentioned below:
- Be salaried or self-employed
- A monthly in-hand income of ₹13,500* or more
- Income received in a bank
- Minimum Cibil score of 600 or Experian score of 650
- Should be aged between 21 years and 57 years
**Please go through the detailed income and credit score requirements
|Income and Credit Score Eligibility Criteria*|
|Salaried Individuals||Minimum In-Hand Income||Area of Residence||CIBIL Credit Score Requirement|
|Rs 13,500||Any||CIBIL Score of 600 /Experian Score of 650 and above|
|Rs 20,000||Mumbai/Thane or the NCR region (Delhi, Noida, Gurgaon, Ghaziabad, Faridabad, etc.)||New to Credit or CIBIL Score of 600 /Experian Score of 650 and above|
|Rs 15,000||Metro City other than Mumbai and NCR||CIBIL Score of 600 /Experian Score of 650 and above|
|Self-Employed Individuals||Rs 15,000||Any||CIBIL Score of 600 /Experian Score of 650 and above|
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