Sudden or urgent money requirements can occur at any point of time in one’s life. Although Personal Loans are meant to solve financial issues, such as lack of money and financial crisis, one may also apply for a Personal Loan to fulfil any need which has been pending for some reason. There are a lot of factors that the financial lenders considers before anyone is approved for a Personal Loan. The lenders do not necessarily as for collateral since Personal Loans are unsecured. But this also put a big risk for the lenders as if the borrower is not able to repay one of the EMIs on time, the difficulty for the Lender increases. Precisely because of this reason, the interest rate on Personal Loan is comparatively higher then the other loans.
Disbursal of personal loan solely depends on the repayment capability of the applicant. If the applicant maintains a high credit score (close to 900), the chances of loan approval increases but on the other hand if his/her credit score is not above 750, then getting personal loan becomes a bit challenging. Therefore, the lender should be confident enough with regards to the repayment capability of the applicant before providing the approval and disbursal of requested loan.