1. Credit Score and Credit History

Your credit history (such as your CIBIL record) shows how well you have handled credit or loans in the past.

A good score (usually above 750) means you are a low-risk borrower.

Paying your loan late, paying arrears, or applying too many times can lower your score.

Tip: Pay bills and EMIs regularly to maintain a good score.

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2. Income and Employment Stability

· Banks need to be sure that you have enough income to repay the loan.

· Salaried individuals should show salary slips and bank statements.

· Self-employed individuals should submit tax returns and business documents.

· A consistent record of employment or business helps build trust with lenders.

3. Outstanding Loans and Debt

• If you already have a loan or credit card debt, banks will check if you can handle the additional debt.

• They calculate the ratio of your monthly debt to your income.

• The lower this ratio, the more likely you are to get a new loan.

• Tip: Try to pay off or reduce your current debt before applying.

Your Age and Loan Duration

· Your age affects how long you can repay the loan.

· Most banks lend to people between the ages of 21 and 60.

· Younger borrowers usually have longer repayment periods and lower monthly payments.

· Older applicants may have shorter loan terms.

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4. Loan Amount and Purpose

Banks think about why you require the loan and how much you are requesting.

Home loans need collateral (property), so you can borrow more money.

Personal loans do not need collateral but have lower limits.

Be sincere and specific about why you need the loan.
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5. Collateral (Security for the Loan)

For secured loans such as home or automobile loans, the bank will verify the property or asset you’re providing.

The worth of your collateral determines the highest loan amount.

Banks typically lend between 75–90% of the value of the asset.

This makes the loan more secure for the bank and frequently results in improved interest rates for you.

6. Other important points

· Proof of address and identity is required to verify your identity.

· A positive record with your bank (such as regular savings) can help your application.

· Sometimes, a co-applicant or guarantor can increase your eligibility for a loan.

Conclusion

Understanding what affects your loan eligibility can help you prepare and apply with confidence. Keep your credit rating high, have a stable income, control your current debts, and be open about your loan requirements. This makes it easier and faster for you.