Instant Personal Loan Online: What to Check Before Applying

When looking to get an instant personal loan online, one of the first questions that comes up is, “How fast can I get the money?” However, there is a better question to ask, which would be, “What does the lender see when I apply?” While speed makes it easy to apply, your credit profile remains important nonetheless.

It is the credit profile of the applicant that really counts. Take some time and check your credit profile before applying for any instant loan.

Don’t Stop at Checking Your Credit Score

A free credit score helps you get an accurate picture, but a number alone isn’t everything.

In addition to check credit score or trying to have a check CIBIL score, make sure you also look into the complete credit report. The CIBIL report consists of details like account details, repayment details, and lender inquiries, amongst others.

This is the reason why a CIBIL score check is always followed by understanding on how to read a credit report.

Pay special attention to:

1. Unfamiliar loans or credit card accounts

2. Incorrect balances on the accounts

3. Mismatched repayment details

4. Closed accounts

5. Unrecognized inquiries

Checking your own CIBIL Score & Report once every calendar year is free, and it won’t affect your credit score.

Why Is Having More Than One Application Bad?

For instance, let's say you have an urgent need for funds. You Google "loan instant", check a few options, and apply for all those that promise quick approval.

This method can give rise to multiple lender inquiries. According to CIBIL, multiple applications in a short span of time could have a detrimental impact on your credit score. This holds true irrespective of whether you are searching for a personal loan, business loan, housing loan or home loan.

Before you go for a loan apply online, get yourself checked first.

PrimeScore is also helpful in identifying possible inaccuracies in the credit score profile of the borrower before the actual borrowing process.

Quick Approval Doesn’t Mean Foolhardy Borrowing

An instant personal loan online shouldn’t become a means of skipping through any financial verifications. Compare total cost of borrowing, payment liability, and lender’s terms before agreeing on one.

Additionally, if you use a digital lending platform for your borrowing needs, it is advisable by RBI to ensure its link to the bank/NBFC instead of just clicking on any random URL/app.

Check your credit score profile first, analyze the terms of the loan before applying for a borrowing that you cannot pay back.

FAQs

1. Is an instant personal loan guaranteed if my credit score is good?

No. Lenders consider multiple factors, including income, existing obligations, credit history and their own eligibility criteria.

2. Does checking my own CIBIL score reduce it?

No. CIBIL states that checking your own score does not impact your CIBIL Score.

3. What should I check before applying for an instant loan?

Review your repayment history, active accounts, outstanding balances and recent enquiries.

4. Can multiple loan applications affect my credit profile?

Repeated applications within a short period can result in multiple lender enquiries and may negatively affect your CIBIL Score.

5. What if I find an incorrect entry in my credit report?

Verify the information and contact the relevant lender and credit bureau through their formal dispute process. CIBIL notes that lender confirmation is required for changes to reported information.