Important Checklist When Planning To Apply For A Personal Loan

Financial emergencies can knock on your door anytime and that too, without any prior warning. Whether you want to consolidate your debt, arrange finances for your wedding or cover medical bills, it is not always possible to be fully prepared. At times when the situation is already challenging, financial troubles only end up worsening the current state of affairs.

The good news is that with easy personal loans, now you can independently manage such difficult times. 

Personal loans are a type of unsecured loans that allow you to borrow a lump sum. Since these loans do not require any collateral, you will find it easier to apply and use them for any of your needs. The easy payback instalments allow you to return the loan at your pace and convenience.

Before you apply for a personal loan, you will have to keep a few things in your mind. It will help you in making an informed decision about the loan and getting it approved timely and smoothly.


Before you bank your hope on personal loans, you need to confirm if you are eligible for it. If you are 21 years and above and have a steady source of income, there shouldn’t be a problem with it. Provided, you have a satisfactory credit score. 

Personal loans are so easy to avail that they are one of the most friendly self employed loans. Submit the required documents and your proof of income and you will immediately get the help you need.

Credit Score

Your credit score defines your creditworthiness. In other words, it is how the lenders determine if you are the right candidate to extend a loan. 

Your credit score depends upon your past credit behaviour. For instance, if you have been consistent and regular at paying your EMIs and credit card bills, your credit score will be favourable. 

A low credit score is like a red flag to the lenders. To protect their interests, they may charge a higher interest rate on personal loans. On the other hand, if you have a good score, you can negotiate for a better interest rate and favourable loan terms.

Interest Rate

When you take a loan, the interest rate defines your total liability. If the interest rate is high, your debt will accumulate and grow larger over time. 

For instance, credit cards have an interest rate that can go as high as 30-40%. It is also the reason you will always hear the experts advise you against missing your credit card payment dates.

When you apply for a personal loan, try to research the ongoing interest rates in the market. It will help you in choosing a lender who offers reasonable rates. You can also negotiate with the lenders when you know what the competitors are offering.

Hidden Charges

Several banks and other lenders levy some charges or processing fees that you get to know only after the loan has been processed. It can come as a shock and inflate your total cost of the loan. At a time when you are struggling financially, such hidden charges will only end up increasing your troubles.

To avoid such an unpleasant situation, be upfront with the lender. Ask them to be transparent with you.


When you apply for a personal loan, you are probably in a state where you need financial help. The loan amount will help you in managing your current finances, but it shouldn’t make the following months challenging for you. If the EMIs are too high, it will become tough for you to manage your monthly expenses. 

Most banks and lenders offer online EMI calculators that can help you in this regard. All you have to do is key in some details like the loan amount, loan tenure, etc. to understand your monthly liability. You can also play around with the amount and the tenure to get an approximate affordable EMI amount.

If you want to increase the loan tenure to make your monthly expenses manageable, you may want to know that doing so will increase the total liability. Shorter termed loans will help you in clearing your loans faster and at lesser amounts paid in interest. In the end, you are the best judge of your situation and should go ahead with what suits you the most.


You don’t want to go through the entire process of researching and applying for a personal loan only to get rejected. That too, because of incomplete documents. 

Although personal loans are easy to apply, you will still need to furnish all the required documents. Most lenders make this list available on their sites. Make sure that you have them in place to get your personal loan approved in the first go. 

Here is a common list of documents that you will be required to submit along with your loan application –

  • A duly filled copy of your personal loan application
  • Passport size photograph – keep a few copies handy
  • Identity proof – Any government-approved identity proof should be good, like Aadhar Card/Voter ID Card/Passport/PAN Card/Driving License
  • Residence proof – You can submit either your passport or utility bill as the proof for your residence
  • If you are salaried, arrange your last 3 months’ salary slips and Form 16, along with the bank statement of last 6 months
  • If you are self-employed, you can give your last year’s bank statement for both savings and current account


Personal loans are like a friend who is always ready to help you in a tough situation. They help you be independent and manage your financial woes smoothly. With this checklist by your side, you can not only get them approved but also get favourable terms and conditions.


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