What is an Instant Pre-approved Loan?

A pre-approved instant loan is one of the most remarkable financial products of the 21st century. It has made the process of getting a loan easier than ever. The only catch here is that it’s not available for everyone. So, what does it take to get a pre-approved instant cash loan from your service provider? Well, there are a couple of things but the most important factor is your credit score. If you have a high credit or CIBIL score then you will be considered a creditworthy borrower. Those who fail to get a good score will reduce the probability of getting a loan instantly that is pre-approved. Read on to know more about pre-approved instant loans. 

What is an instant pre-approved loan?

An Instant pre-approved loan is a type of loan product that is offered to existing clients by banking and non-banking financial institutions. The amount of loan that is pre-approved might vary depending on the credit score of the user. Unlike other loan products, a pre-approved loan is already granted to the customer. They have a choice whether they want to take a loan or not. Once they have accepted the limit, the loan will be instantly processed and disbursed into their account. Most people often fail to distinguish between an instant loan and an instant pre-approved loan. In the former case, the customer is reaching out to the lender. In the latter, the lender is offering the loan. 

When to expect an instant pre-approved loan offer?

A pre-approved instant loan offer is not for everyone. Financial institutions are very picky when it comes to offering a pre-approved loan amount. Customers with a high credit score and long-term relationship with the financial institution are more likely to get a pre-approved loan offer. Let’s take a quick look into some important factors that help to get your instant loan approval.

• A good credit score and credit history

The most important factor that helps to make you eligible for a pre-approved loan offer is your credit score and credit history. Your credit score is a numeric score given after assessing your creditworthiness. This entails multiple factors including past repayment history, number of credits, etc. Credit history summarises your past loan experiences and gives a recap of your credit profile. Paying your loan EMIs and credit card bills on time can boost your credit score.

• Income and expenses 

Another key factor that is taken into account by the lender before providing customers with a pre-approved loan offer is their income. Your income and expenses give a fair idea about your savings and ability to repay the loans punctually. A high income will make you eligible for pre-approved loans. Besides this, if you are earning an average income and have expenses in order, it can help you get pre-approved instant loans. The bottom line is that your account should have a sufficient balance every month for instant loan approval.

What do you need for a pre-approved instant loan?

Pre-approved loans require minimal documentation and since loans are already approved you just need to submit essentials. This includes documents related to income proof, address proof and ID proof. For income proof, you can submit your salary slips for the last 3 months in case you are a salaried employee. Besides this, bank statements are also considered as proof of income. Residence proof criteria can be fulfilled using Aadhaar Card, Passport, or Voter ID Card. This will also act as your ID proof. In addition to these, some financial institutions might also ask for your PAN card details. 

Why an instant pre-approved loan is a good option?

Here are a few reasons why pre-approved instant loans should be your go-to option.

• Competitive interest rates 

One of the most important factors that make a pre-approved loan highly desirable is the rate of interest charged on these loans. The interest rate is comparatively lower than other loans since the borrower has high creditworthiness. A good credit score is a must for getting pre-approved loan offers and therefore the interest rate is very reasonable. 

• Quick processing and disbursement  

A pre-approved personal loan is the best choice for those looking for an instant loan that requires minimal documentation and is disbursed within a short period. One can easily get the approved loan amount within 24 hours using a pre-approved offer.