Complete Details Of Documents Required For Personal Loan

 

Complete Details Of Documents Required For Personal Loan.A personal loan is financial product that has received a lot of attention because it allows people to finance their different needs such as medical bills, home remodeling, holidays and other reasons like paying off bills through a loan. However, before you can be able to access these funds, the following documents shall be required by the lender The lender shall require the following documents before approving the funds. Knowing the necessary papers can help to minimize the time spent on the application and generalize the chances for approval. In this article we’ll go through all documents necessary for personal loan and give some advice on how to avoid possible troubles with application.

1. Identity Proof

The initial condition for granting loans in commercial organizations is the identification of the applicant. Lenders need to verify who you are, and you can provide any of the following documents as identity proof:

Aadhaar Card: An identity document that is globally recognized as being issued by the government.
Passport: Regarding the identification aspect a valid passport can be considered as a proper identification document.
Voter ID: One of the other ID cards that are issued by the government for identification proof only.
Driving License: You can always use your valid driving license as a form of identification too.
Make sure that the document you provide has all the current information and well detailed for no complications to arise.

2. Address Proof

Lenders need to verify your address, and that is why address verification is equally critical in the process. You can submit any of the following documents as proof of your current address:

Utility Bills: Utility bills that are not more than three months, bills like electricity, water or bills of gasses.
Bank Statement: Any document that contains your name and address such as a bank statement.
Rental Agreement: For NRI living in a rented house, registered rental agreement can be produced as proof of residence.
Aadhaar Card: The Aadhaar card is also allowed to be produced under address proof on the condition that one’s address on the card is updated.

3. Income Proof

Borrowers’ ability to repay is the major information that analysts have to get from you, that is why the proof of income is the server component of the conditions an applicant has to provide for taking a personal loan. Depending on your employment type, you may need to provide the following documents:

Salaried Individuals:

Salary Slips: These usually go for the last three months of salary slips.
Form 16: One can get a copy of Form 16 or the income tax return of the previous two financial years.
Bank Statements: Salary slip of the last six months: where the salary credit entries are reported.

Self-Employed Individuals:

Income Tax Returns (ITR): Usually, two last years ITRs are needed most of the times.
Profit and Loss Statement: An original and duly certified Profit and Loss statement for your business.
Balance Sheet: The last two years balance sheet.

4. Employment Proof

For this reason, people with employment, particularly the waged, are usually expected to present proof of employment. You can provide any of the following documents:

Employment Letter: An employment letter from your employer stating your job title, your corporate status and contract length.
Service Certificate: A document endorsed and signed by an employer that contains working details of the employee.
Business Registration Document: In the case of an individual believed to working for oneself you may be required to produce your business registration papers.

5. Credit Report

A credit report is required as part of your loan application documents. Even though lenders usually order this report themselves, you should see it before they do. Having a good credit history will certainly give the benefit of adding spice on your shot at getting approved. If you have not freshly looked at your credit score you need to request for your credit report from the credit bureau. If any of these are true, try to clear them up before you begin the process of applying for the loan.

Complete Details Of Documents Required For Personal Loan

Complete Details Of Documents Required For Personal Loan

 

6. Passport-Sized Photographs

Any photograph taken within three months is acceptable; most lenders will ask for two, passport-sized photos of the borrower. As a rule, two or three photographs must be attached to the application you complete, and, perhaps, submitted. Make sure that the photos are a good quality, and meet the requirements of the lender.

7. Loan Application Form

It is very important to fill every part of the loan application form correctly. The form generally requires you to provide details such as:

Personal Information: Personal details such as name, date of birth, marital status, number of dependents.
Employment Details: Date of appointment, your designation with the employer and duration you served with the employer.
Financial Information: According to your income, current loans and any other liability.
It is also important for the consumer to ensure that they input all information provided is correct in relation to the documents provided.

8. Extra Papers (if necessary)

Depending on the lender’s policies and your specific circumstances, you may be asked for additional documents:

Financial Statements: Other examples of documents that persons using self-employed status may be required to produce may include; Current balance sheets.
Asset Documents: If you are applying for secured personal loans, then any aliases of the amount may require papers related to the collaterals maybe property papers etc.
Co-applicant Documents: If you have a co-applicant then he/she too needs to provide his/her identity proof, income proof etc.,

Required Application Tips

Double-Check Requirements: Some of the loan providers may require different documents from the others. However, regarding any of the other documents necessary in addition to those mentioned above, it can be recommended to consult with the chosen lender.
Organize Your Documents: All papers must be clean and arranged systematically. It also makes the process easier for the lender as well as for you the borrower.
Ensure Document Validity: Ensure that all the document are genuine and updated. Dead documents can cause a hold up in your application being processed.
Provide Accurate Information: Check all the particulars both on the application form and attachments and makes sure that they are correct to the last detail. Sadly, it may create red flags among the lenders because of the differences in the statements.
Follow Up: In most cases, the lender will provide means through which you can track the progress of your application and the requirements you need to supply so it is safe to call or email the lender and check on your application’s progress and what you need to supply.

Conclusion

Personal Loan Application Process can be a very simple process if one is prepared with the proper documents. This will help make a good case in order to converse with the lenders as to which documents are needed and more so make sure that the documents presented are proper and up to date. According to the guidelines outlined in the following article, it’s easier to manage the loan application type and make the necessary preparations to get a loan approval. It is important always to borrow wisely and only select a loan that meets the amount you want and the repayment period you are comfortable with.