Documents Required For a Personal Loan

Documents Required For a Personal Loan

Are you considering taking out a personal loan but need clarification on what documents required for personal loan? This blog will explain exactly what you need to apply for and get approved for a personal loan. Read on to learn more about the necessary paperwork and how you can ensure you have all the correct documents ready!

What is a Personal Loan?

Apply for online personal loan from a lender known for quick approval and funding to get a loan immediately. Lenders require you to provide specific documentation to verify your identity, income, and debts when you apply for a personal loan. The specific documents required will vary from lender to lender, but there are some common items that you can expect to need:

What Documents are Required For a Personal Loan?

Loan Application- To initiate the loan process, each lender will have its own application, which can vary widely from lender to lender. For example, the application process is usually done online if you borrow from an online lender. However, if you borrow from a traditional bank or credit union, the applications can be completed in person or online.

The initial loan application usually asks for your name, address, phone number, date of birth, and Social Security number, as well as your desired loan amount and loan purpose.

You may be asked to provide additional financial details, such as your gross monthly income, rent, or mortgage payment. Again, be sure to answer each question accurately.

Identity proof- Besides obvious reasons like identity theft, lenders must be able to verify your identity to determine if you are a United States citizen or permanent resident and if you are at least 18 years old. In addition, they may ask you for Proof of your active bank account. Two forms of identification include:

• A birth certificate.
• Certificate of citizenship.
• Military ID.
• State-issued ID.
• Driver's license.
• Social Security card.
• Passport.

It is usually possible to make copies of your two forms of identification so that you don't have to submit your originals to the lender. Store the sources safely, so you don't lose them.

Address Proof- Providing Proof of your living situation like a Lease or rental agreement, Utility bill, Proof of insurance on your home, lease/rental or vehicle, Mortgage statement, Property tax receipt, Voter registration card, Bank or credit card statement can help a lender determine how stable your lifestyle is.

Applying for a personal loan should be straightforward if you have all the required documentation. However, if you still need to include all the necessary paperwork, it could delay your loan application or even result in a denial.

Also read about instant personal loan in Bangalore

How do Salaried Individuals Apply for Personal Loans?

At any point in life, financial assistance may be needed. However, in the case of salaried people, with a limited amount of money earned every month, it might become difficult to meet an urgent requirement for cash – and the best way to deal with such an emergency is to take out a personal loan. The banks will need the following documents to approve your loan application.

• Identity Proof (Driving License, Passport, Aadhar Card, Voter ID, etc.)
• Bank Statement of 3 Months
• Residence Proof (Utility Bills such as Gas Bills, Electricity Bill, Voter ID, etc.),
• Salary Slips/Certificate of 3 Months
• Passport, Ration Card, Bank Statement, Rental Agreement, etc.)
• ITR - Income Tax Return (Form 16)
• PAN Card (Permanent Account Number)

For Personal Loans, What Documents Do Self-Employed Individuals Need?

As self-employed individuals run businesses, there are times when urgent funds are needed for any number of purposes. This could include paying a supplier or manufacturer, hiring young talent to grow their venture, renovating the office, or adjusting their cash flow. In such scenarios, a personal loan is ideal for satisfying these requirements. Here is a list of documents you will likely need to apply:

• Identity Proof (Aadhar Card, Driving License, Voter ID, Passport, etc.)
• PAN Card (Permanent Account Number)
• 3-month bank statement
• Proof of residence (Utility Bills (such as Voter ID, Electricity Bill, Gas Bill, etc.), Passport, Rental Agreement, Ration Card, Bank Statement, etc.)
• Balance Sheet of 2 Years
• Income Computation of 2 Years
• Clearance Certificate/IT Assessment
• Proof of Business - Service Tax Registration, Licence, Registration Certificate
• Income Tax Returns
• Profit/Loss Account Statement for the past 2 Years

Also read about types of personal loan

Eligibility Criteria for a Personal Loan

To be eligible for a personal loan, you must:

-Be at least 18 years old

-Be a citizen or permanent resident of the United States

-Have a regular source of income

-Have a checking or savings account

Conclusion

Applying for a quick personal loan can be an intimidating experience, but with the right documents in hand, it doesn't have to be. Knowing which documents required for personal loan and providing all necessary documentation accurately will increase your chances of getting approved for a loan quickly and painlessly. Having the correct documentation is only one part of the process; make sure that you understand other criteria lenders use when reviewing applications to put yourself in a better position to get the right loan.