About Federal Bank Personal Loan
Federal Bank has been offering banking services to Indians since the pre-independence era, catering to all their financial needs. It offers multipurpose personal loans designed to meet any personal financial obligation a customer could have. Federal Bank personal loans can be availed at competitive interest rates, ensuring borrowers do not feel the pinch of financial burden.
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Federal Bank Personal Loan Eligibility
Federal Bank has multiple personal loan schemes, with each one catering to different needs. The basic eligibility criteria for these schemes are mentioned below.
- Minimum income – Resident individuals with a minimum monthly salary of Rs.50,000.
- Indian citizen – Applicant should be an Indian citizen.
- Minimum age – Applicants should be at least 18 years old.
- Maximum age – The loan amount should be cleared before an applicant reaches the age of 55.
- Work experience - Applicant should have minimum 3 years work experience in the current job.
- Select cities - Individuals employed at select cities - Kochi, Chennai, Thiruvananthapuram, Pune, Mumbai, New Delhi & NCR, and Bangalore are eligible for Federal Bank personal loan.
- Minimum age - Applicants should be at least 18 years old.
- Maximum age – Applicants should be less than 55 years old.
- Net worth – Not mentioned.
- Indian citizen – Applicants should be Indian citizens currently residing in the country.
- Minimum age - Applicants should be at least 60 years old and the age of the spouse should not be less than 58 years.
- Spouse – Applicants cannot have more than one spouse. Spouses can choose to be co-applicants if they co-own a property with the borrowers.
- Property – Applicants should have a property registered in their name.
Factors affecting Federal Bank Personal Loan Eligibility
The eligibility criteria for a Federal Bank personal loan can be affected by multiple factors, few of which are mentioned here.
- Income – Federal Bank is a financial institution and their business depends on the loan repayment capacity of a borrower. The income of an applicant is crucial in determining personal loan eligibility and applicants should meet the minimum income limit set by Federal Bank. Applicants with income lower than the minimum limit might find it hard to obtain a loan.
- Employer background – Applicants working for reputed organisations stand a better chance of getting their loan approved as certain employers have built credibility around their brand. Such employees are assured their monthly salary, providing them no reason to default on loan payments.
- Age – Applicants need to meet the minimum age requirements set by the bank. Young applicants who have just started working might not be financially stable and might not be viewed favourably by banks. Applicants approaching their retirement age might also find it hard to avail a loan as they might not have the same disposable income to clear the loan post retirement.
- Type of employment – Permanent employees are preferred by banks as they have a steady source of income and job security. Temporary employees might find it hard to obtain a personal loan as they do not have any job security at work. Self-employed applicants need to have suitable expertise in their field to increase their eligibility for a Federal Bank personal loan.
- Relationship with the bank – A healthy banking relationship provides key indicators to gauge an applicant and could improve the chances of an applicant getting a personal loan sanctioned.
- Existing debt – Existing credit and other debt liabilities can affect loan repayment, with banks treading cautiously in such cases.
- Educational background – Well educated applicants stand a better chance of obtaining gainful employment in this competitive world, which means they are more likely to repay the loan amount on time.
How CIBIL score affects your Federal Bank Personal Loan Eligibility
Banks use the CIBIL score of an applicant to determine his/her financial stability, with the CIBIL score providing invaluable insights about the individual. It highlights the credit history, previous repayment habits and allows Federal Bank the opportunity to chart the financial credibility of the applicant. A good CIBIL score would almost invariably guarantee a Federal Bank personal loan, as a high score boosts the application status. Average scores might be considered by Federal Bank, but their approval would depend on other factors like job status and income.
Applicants with a poor CIBIL score will be rejected by Federal Bank as such individuals could become defaulters, risking the loan amount offered by the bank.
How to increase Federal Bank Personal Loan Eligibility
Following a few simple steps could help increase an individual’s eligibility for a Federal Bank personal loan.
- Longer tenure– Longer loan repayment tenures imply lower EMIs, which essentially translate into a lighter repayment burden on the borrower.
- Timely payment – Timely payment of past loans and credit card bills improve the credit rating of an individual, increasing the chances of an applicant availing a loan.
- Prepayment – Prepaying any existing loans creates a strong impression on the bank and also ensures that an applicant is left with a higher disposable income, strengthening the loan application.
- Limiting loan applications – Multiple loan application reflect poorly in the credit report, lowering the overall score considerably. They can also portray the applicant as being loan hungry and desperate, hampering overall credibility.
- Limiting loan amounts – Asking for amounts higher than needed could make bank authorities cautious. Smaller loan amounts are easier to obtain as they can be repaid easily, without burdening the applicant, signalling a win-win for both sides.
- Maintaining a steady job – Having a stable job is viewed upon positively as there is a regular source of income, lowering the chance of defaulting.
FAQs on Federal Bank Personal Loan Eligibility
Q. Can NRIs or foreign citizens apply for a Federal Bank personal loan?
A. No, only Indian citizens are eligible for Federal Bank personal loans. NRIs can, however, avail loans under the NRI loan scheme.
Q. Do loan applicants have to furnish security to obtain a loan?
A. Yes, loan applicants are required to furnish security in most cases.
Q. Can a personal loan be paid off by the legal heirs of a pensioner?
A. Yes, legal heirs of a pensioner can choose to repay the loan on behalf of the pensioner.