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  • Indian Overseas Bank (IOB) Personal Loan Eligibility

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  • Indian Overseas Bank offers 3 types of personal loans. Each option has its own set of eligibility criteria. The three IOB loan options are:

    • IOB Personal Loan – This option is available to all customers and is meant to be used for the purchase of consumer durables. This includes metal and wooden furniture, electronic goods, and electrical products.
    • IOB Passion – This loan is designed to help purchase products related to your passion. For example, music instruments, sporting goods, art materials, and even for paying coaching fees.
    • Special Personal Loan HNI VIP – This loan is for high net worth individuals and is meant for the purchase of household goods.

    IOB Personal Loan Eligibility Criteria

    Criteria Salaried
    Minimum?Net Monthly Income?(NMI) Rs.5,000?
    Maximum Age?Limit 60 years
    Residential Status? Indian residents?
    Employment Type? All individuals ?
    Salary Account with IOB Not mandatory?

    IOB Passion Personal Loan Eligibility Criteria

    Criteria? Salaried?
    Minimum?Net Monthly Income?(NMI)? N/A?
    Age?Limit 10 to 50 years
    Residential Status? Indian residents?
    Employment Type? All individuals ?
    Salary Account with IOB Not mandatory?

    IOB Special Personal Loan HNI VIP Eligibility Criteria

    Criteria? Salaried?
    Minimum?Net Monthly Income?(NMI)? More than Rs.75,000.
    Age?Limit Between 25 and 60 years at loan maturity
    Residential Status? Indian residents?
    Employment Type? All individuals ?
    Work Experience At least 2 years in the same organisation

    Other Eligibility Criteria for IOB Personal Loans

    IOB has a common requirement for all the personal loans it offers. This is regarding the security or collateral they accept for these loans. For all the three loans, the bank will hypothecate the product you buy. The bank will also accept a guarantee made by a suitable third party.

    Factors Affecting IOB Personal Loan Eligibility

    • Age: Each loan offered the bank caters to a specific age group. There is a minimum age and a maximum age. The maximum age relates to the age of the individual at the time of the maturity of the loan.
    • Type of individual: Some loans are available only to specific types of people. For example, the IOB Passion loan is available only to those who are passionate about sports, music, arts, etc. and have the necessary skills for the same. People interested in making such activities their hobbies are also allowed to borrow money under this loan.
    • Monthly Income: How much you earn every month has a bearing on your loan eligibility. While normal loans are available to all individuals who earn above a certain low-income limit, there are loans set apart for high net worth persons who earn a high level of income.
    • Job stability: Sometimes, IOB may require you to prove that you’ve been working with one organisation for at least a year or two. This indicates the stability of your job. A stable job means a stable monthly income. This means that you have the financial stability to repay the loan if you take it.
    • Security or collateral: To take one of these IOB loans, you need to offer collateral. This could be in the form of a third-party guarantee or you can hypothecate the product you are buying.
    • Credit score: If you’re looking to get favourable loan terms, you need to have a good or an excellent score. The bank will hesitate to give you a loan if your credit score is average or low. A low score is an indication of high loan-default risk. Having a score of at least 750 or more can help you get certain benefits in the form of lower interest rates, better repayment options, etc.

    How to Improve Your Chances of Getting an IOB Personal Loan

    • Try and improve your credit score: As we mentioned earlier, your credit score plays a very important role in determining your loan eligibility. So, check your score before you apply. If you find that your score is below 750, you should work on improving it. Improving your credit score will boost your chances of successfully getting the loan. Start by paying your EMIs on time and utilising your credit limit wisely.
    • Apply when you have a higher income: Although each loan option has its own income criteria, banks prefer to grant loans to people who earn a higher income. Your age and income play a role in this. People in their late twenties may finder it easier to get a loan than those who are just starting their careers. The higher your income and work experience, the better your approval chances are.
    • Lower your debt-to-income ratio: This refers to how much of your income is going towards paying off current loans. The more you spend on repaying loans, the higher this ratio will be. IOB may not give you a loan if this ratio is high. If it is more than 40% or 0.40, you should look at reducing it by paying off some loans before you apply.

    IOB Personal Loan Details

    IOB Personal Loan
    Interest Rate? 11.90% p.a.?
    Loan Amount? Up to Rs.5 lakh
    Loan Tenure? Up to 60 months?(5 years)
    Processing Fees? Up to 0.50% of the loan amount + taxes

    IOB Passion Loan
    Interest Rate? 11.40% p.a.?
    Loan Amount? Up to Rs.5 lakh
    Loan Tenure? Up to 60 months?(5 years)
    Processing Fees? Up to 0.50% of the loan amount + taxes

    IOB Special Personal Loan HNI VIP
    Interest Rate? 11.90% p.a.?
    Loan Amount? No upper limit
    Loan Tenure? Up to 72 months?(6 years)
    Processing Fees? Up to 0.50% of the loan amount + taxes

    FAQs

    1. What is hypothecation? How does it work?

    When you take a loan to buy a certain product, the bank may exercise the right to confiscate the product in case you fail to repay the loan on time. in such cases, you don’t have to offer any extra collateral. The product you buy will act as the collateral. This is known as hypothecation. Do keep in mind that when something you buy is hypothecated by the bank, you have to pay every EMI on time. if you keep defaulting on your repayments, the bank may take possession of the item.

    2. What is the loan amount available for the IOB Special Personal Loan HNI VIP scheme?

    For the IOB Special Personal Loan HNI VIP option, the bank offers loans of up to Rs.15 lakh with hypothecation of the products you buy. For loans of more than Rs.15 lakh, the products you buy will be hypothecated and you will also have to offer additional collateral or a guarantee by a third party.

    3. Does Indian Overseas Bank charge prepayment fees?

    No, IOB does not charge any fee for loan prepayments.

    4. Does IOB take any margin on the loans it provides?

    Yes, the bank deducts 10% of the cost of the item you buy as margin.

    5. What is meant by maximum age at loan maturity?

    This means the maximum age of the borrower must not be more than the specified age when the loan tenure ends. For example, if the maximum age is 60 years at loan maturity for a tenure of 5 years, the borrower cannot be over 60 years of age at the end of the 5-year tenure.

        

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