How much Personal Loan Can I Get on 25000 Salary in India?

How much Personal Loan Can I Get on 25000 Salary in India?

Personal loans are very popular owing to the flexible usage options and the quick turnaround time. Now you can avail loan at one click if you satisfy the personal loan eligibility criteria set out by individual financial institutions. The loan amount will land in your bank account within seconds if you are an existing customer of the lender and within hours if you are a new customer. 

The main criteria to decide on the loan amount for the personal loan is your income and the repayment capacity. The repayment capacity is assessed based on the existing fixed financial obligations versus your net monthly income. Ideally, the ratio should be 50% and above. 

Note: Check different Lenders of Personal Loan for Low Salary

How Much Personal Loan Can I Get on 25000 Salary?

You opt for a personal loan only when you are in dire need of finance and when your savings will not suffice your requirement. But you will wonder how much personal loan can I get on 25000 salary and will it be adequate to suit my requirements.

The calculation of the Personal Loan amount varies from lender to lender depending on their internal credit policies. However, the general criterion is that the minimum FOIR or Fixed obligation to Income ratio should not exceed 40% to 50% of the net income after considering the EMI for the proposed loan. The maximum loan amount that will be permitted will generally be 10 months of the gross salary, and so you will be able to get a personal loan up to Rs. 250000/- provided the FOIR criteria is complied with.

It is recommended to be aware of the proposed EMI before applying for the loan. You can calculate the EMI easily with the EMI calculator available on the official websites of the lenders.

Additional Reading: CIBIL Score Check Free Online by Pan Number

Eligibility Criteria to Avail Personal Loan on 25000 Salary

Most of the financial institutions provide Personal Loans for both salaried as well as self-employed individuals/professionals. However, some of the banks restrict the loan to only salaried individuals. 

The eligibility criteria to avail personal loan on 25000 salary are as follows:

The above-mentioned eligibility criteria is a general one and could vary from lender to lender. The lenders, at their discretion, may vary the eligibility criteria based on the customer’s profile.

Documents Required

KYC and Income documents as detailed below have to be submitted while applying for a personal loan on 25000 salary

Best Interest Rate of Personal Loan for 25000 Salary

A comparative list of the prevailing interest rates of Top financial institutions for 2021 in India is given below.

Steps to Avail Personal Loans with Salary up to Rs. 25,000

Before applying for a personal loan on 25000 salary you will have to consider the following.

• Eligibility: You should primarily check the eligible amount commensurate to your salary using the EMI calculator. You should keep in mind that the debt to income ratio should not exceed 40% to 50% of your net income after considering the proposed EMI. Consolidate all your existing commitments and arrive at the differential available income to service the EMI. Check eligibility keeping the affordable EMI in mind, and apply for the loan amount accordingly to hasten the approval process.
• Credit Score: Draw your credit report and check credit score. If there are any discrepancies, then get is resolved through the customer support group of the credit bureau. The credit score should necessarily be between 700 to 750 to be eligible for the loan amount and also to get a good deal in terms of interest.
• Interest Rate: Compare the current personal loan interest rate in the market as well as the other charges and then approach the lender who is offering the best deal.

Once all the above pointers are in place, apply for a personal loan on 25000 salary by filling an online application available on the official website of the vendor.

• Access the website of the lender.
• Choose ‘Personal Loan’ under the ‘Loans’ option.
• Click on the ‘Apply Now button.
• You will be directed to the online personal loan application.
• Input the required personal, contact and income details and submit the application.
• You may have to scan and upload the required documents.
• In the case of some lenders, the representatives will contact you will pick up the required documents from your doorstep.
• The loan application will be processed, and if approved, the same will be communicated to you vide SMS or Email.
• On execution of the documents, the loan proceeds will be credited to your account.

If how much personal loan can I get for 25000 salary from the bank where my salary account is maintained is your concern then, you can check for a pre-approved personal loan by logging in to net banking. If you are one of the select customers eligible for the loan, you can place a request by mentioning the loan amount and tenure, and the amount will be credited to your account within seconds.

In addition, you can also approach the nearest branch of the lender to apply for the loan via a loan application along with the required documents.

How can I improve the eligibility for a Personal Loan in India?

To improve the eligibility for a personal loan on 25000 salary in India, you will have to deliberate on the following points.

• Credit Score: Maintain the credit score at 750 and above by paying the existing EMIs and credit card dues well before the due date. A good score is like a financial character certificate. It projects you as a responsible borrower who has a commitment towards repayment. If you have a good CIBIL score, you will be categorised as a low-risk candidate, and the lender will offer a lower rate of interest as well.
• Avoid multiple enquiries: In a quest for urgent finance, you might land up making multiple enquiries simultaneously with various lenders. Every time an enquiry is made, the lenders will draw a credit report that will reflect your credit history. This will implicate you as a person desperate for credit and will not carry a good impression as far as the lenders are concerned. So you should avoid hopping from lender to lender seeking a loan.
• Pay off existing debts: Try to reduce your existing obligations by paying off some of the debts. This will help in improving the debt to income ratio, which will, in turn, improve your eligibility.
• Declare all income sources: In addition to your regular income, if you have any other source of income like rent, interest on deposits, dividends or any other income from investments, declare the sources to improve your eligibility.
• Add a co-applicant: You can add a co-applicant with a good credit score and regular income to improve the eligibility. The co-applicant can be a spouse, parent or child.

Frequently Asked Questions

✅What are the criteria to calculate personal loan eligibility?

The personal loan eligibility will depend on various factors like credit score, income, repayment capacity, number of dependents, type of employment, and stability of income.

✅What is the eligible loan amount for a salary of Rs. 25000/-?

The loan amount is normally equivalent to 10 months gross salary. This may, however, vary from lender to lender depending on the internal credit guidelines. The maximum amount you can get for a personal loan on 25000 salary will be Rs. 250000/-This again depends on your income, repayment capacity and credit score. Credit Score because the interest rate depends on the credit score. The higher the credit score, the lower will be the interest. With a lower interest, the EMI will also be lower, and you will be able to get a higher loan amount.

✅ What are the different modes to repay a personal loan?

The different modes to repay a personal loan are:

• Registering standing instructions through NACH mandate
• Setting up an AutoPay through net banking
• Transfer through NEFT or RTGS
• Post Dated Cheques

The above-mentioned are common repayment modes. However, the repayment modes may differ from lender to lender.

✅ What is the credit score required for Rs. 25000 personal loan?

The credit score required for Rs. 25000/- personal loan will be 750 and above.

✅ How is the EMI for Rs. 25000 personal loans calculated? 

The EMI is calculated using the formula [P x R x (1+R)^N]/[(1+R)^N-1] where P is the Principal, R is the rate of interest, and N is the tenure. You can try different variable combinations and arrive at the desired EMI that can fetch the maximum loan amount.

✅How does the credit score impact the Rs. 25000/- personal loan? 

A good credit score speaks of your financial discipline and your commitment towards repayment of the loans and credit card dues promptly. You will be considered as a responsible borrower, and the lender will be convinced about your integrity and will offer you the loan at a lower rate. This will reduce the cost of the loan as the EMI will be low when the interest is low.

✅Is it always necessary to go for the lowest EMI while applying for a personal loan?

The EMI choice again depends on your repayment capacity. If your existing obligations are low and your debt to income is at a sufficiently lower level, then you can opt for a higher EMI and shorten the tenure. This will reduce the cost of the loan. It is not mandatory to choose the lowest EMI. Lowest EMI is only a convenient option to increase your eligibility.

✅ Is it a good option to pay off credit card dues with a personal loan?

If you have opted for a revolving credit for your credit cards and are habitual of paying only the minimum amount on the due date, the rate of interest charged on the outstanding balance is much higher than the interest on the personal loan. So it is highly recommended to avail of a personal loan and clear the credit card dues as you will have the option of consolidating all thee credit card dues and paying off with a personal loan to reduce the cost of the loan.

Also Check: Experian Credit Score