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Pre Approved Loan: What is Pre-Approved Loan? Know these important things before accepting such offers

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Pre Approved Loan: Banks or financial institutions prefer to give loans to such borrowers who are financially strong. This is because such borrowers do not default and are more likely to repay the loan. Many banks do not wait for borrowers to give loans and themselves approach financially sound borrowers and offer them loans. When banks themselves approach the borrowers for granting loans, it is called a pre-approved loan.

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Now the question is, should you accept these pre-approved loan offers? How should you evaluate a pre-approved loan offer? Let’s know.

What is pre approved loan

The pre-approved loan is often agreed upon by the lender and the loan is disbursed on the basis of eligibility criteria and applicable terms and conditions. Under a pre approved loan, banks usually know the creditworthiness of the borrower in advance. For example, banks know about your credit score and income. However, they may still require documents like ITR return and latest income proof to verify repayment capacity and current income status. Banks can offer you a pre approved loan. For example, you may get offers for pre-approved home loans, car loans, bike loans and personal loans.

Who gets the pre approved loan offer?

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Those borrowers who have better financial condition are more likely to get pre-approved loan offers. Some pre-approved offers are for a limited time and expire after a period of time. Pre-approved loans are mostly given to individuals with high credit score, zero loan default history, high income as per ITR.

Difference between pre-approved loan and regular loan

In case of pre-approved loans, the bank already has the information about the eligibility of the borrower. Whereas, in a regular loan, the bank first gets the loan application and then the eligibility of the applicant is checked. When you get a pre-approved loan offer, the loan limit, interest rate and charges are already disclosed. Whereas while applying for a regular loan, the loan amount is not known. How much loan the borrower will get depends on things like his credit score, age, existing loan. If you do not accept a pre-approved loan, it does not affect your credit score. But applying for other loans will have a slight negative impact on your score.

How to check pre-approved loan offers?

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Banks or financial institutions usually inform their customers about the offer through various modes such as email, WhatsApp message, SMS and through the customer’s mobile / online banking platform. Apart from this, the customer support team of the bank can also call you. You can also visit a loan aggregator online where you can get all pre-approved loan offers at one place.

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Can a pre-approved loan get rejected?

The lender can still reject your loan even if it is pre-approved. There are certain documents that the borrower has to submit for the loan. If you do not submit these within the stipulated time, your loan may be rejected. Banks usually offer pre-approved loans based on the information already available. Suppose the bank finds a difference between the information already available and the information given by the applicant, then in this situation also the bank can reject your loan. For example, your loan can also be rejected based on things like recent change in job, sudden drop in credit score, deterioration in financial condition, change in bank’s criteria.

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Important things to know before accepting loan offer

Pre-approved loan offers should be accepted only when there is a need for funds. Never take advantage of a loan facility just because you are eligible for it and can easily avail it. Before accepting a pre-approved loan, one should compare the interest rate, tenure, charges and applicable terms and conditions of different banks. Accept a pre-approved loan only if you find it similar to or better than what any other bank offers. Beware of fraudsters during this time. You can be lured into the trap by making fake loan offers through SMS or email.

Pre-approved personal loan: Quick disbursal and other top benefits to know

Personal loans are short term loans that you can avail to meet your financial needs. With fintech advancements, it is now possible to avail such loans completely online and without ever visiting a lender’s physical branch. As such, the online pre-approved personal loan is now quite common and hugely beneficial for borrowers. However, lenders only offer a pre-approved loan to existing customers, particularly those who have cleared the initial criteria. This is where the difference between an online pre-approved personal loan and a regular personal loan comes to fore, as the latter requires you to apply, whereas the former is an offer you can avail.

Always remember that lenders will not offer a pre-approved personal loan without an eligibility check. Once you qualify, the pre-approved loan disbursement time is almost instant. This allows you to get your sanction without any delays, making it a viable financing tool for any need. To know more about the features of an online pre-approved personal loan that allow you enjoy quick disbursal, read on.

No need for additional documents or collateral to ensure speedy disbursal
A pre-approved loan is only offered to existing consumers, and lenders determine the offer based on the information that they already possess. This usually includes your financial information, credit profile details, and your KYC details. All of this information is critical to evaluating your profile and determining a suitable offer.

As such, you do not need to furnish any additional documents. This helps make the disbursal process quick, easy, and completely hassle-free. For instance, when you avail a Bajaj Finserv Pre-approved Personal Loan, you can simply check for an available offer, verify your identity, and request disbursal. However, in some cases, you may be asked to submit some documentation, such as:

• Cancelled cheque
• Bank details
• KYC documents

Moreover, an online pre-approved personal loan has the added benefit of being a collateral-free instrument. This means that you do not need to pledge any of your assets as security to avail your loan. This expedites the process because the lender does not have to evaluate the asset or undertake any other lengthy verification protocols.

Quick disbursal of approved amount helps meet financial needs without any delays

As mentioned above, the pre-approved loan disbursement time is far quicker than that of a regular loan. In fact, leading lenders can grant you immediate access to the approved funds. The reason for quick disbursal is that the lender has already analysed your profile, eliminating the need for lengthy underwriting processes. An online pre-approved personal loan also negates the need to fill various forms. Simply check your offer, approve it, and authorise disbursal.

Do note that the online pre-approved personal loan sanction will depend on your financial profile and your relationship with the lender. While easy to avail, this sanction may not be the maximum amount offered by the lender and so it may be better suited for short-term expenses.

Digital loan provisions to expedite processes

Fintech advancements have made accessing such offers quick and easy. Thanks to digitalisation, your loan acquisition process can be completed entirely online and without any issues whatsoever. This includes every step, even disbursal. You never have to step into a lender’s branch to get your money.

Moreover, you also have the option of submitting any required documents on the digital platform itself. You can upload files and send them for approval, if required. With a completely online process, you also get the benefit of managing your loan digitally. Leading lenders like Bajaj Finserv give you access to an online account wherein you can track your loan with ease. You can check your repayment schedule, track payments, and much more right from the comfort of home.

To enjoy the benefits of such provisions, keep in mind that online pre-approved personal loan offers come with a time limit. This means that the offers will expire after the given time period. And although pre-approved, the lender may revoke the offer if you do not meet the minimum eligibility criteria. Additionally, when you check the pre-approved personal loan offer, you should also keep the following points in mind before availing of the offer:

• Conduct a thorough review of the offer
• Compare various pre-approved offers
• Understand the terms and conditions
• Ask the lender about any other charges

Disclaimer; This Article Only Information perpose 

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