Personal loans come in handy when you require instant money. A personal loan application and approval procedure is quick and may be disbursed in just 2-7 days. Even while personal loan usage has no restriction with zero requirements for providing any collateral or security, there are a few of the basic eligibility parameters that you as an applicant must be well-versed with before opting for the personal loan option. One of the crucial aspects you must be aware of is your age.
Let’s now look at why aged individuals avail loans and how this impacts your loan eligibility.
Age & Repayment Tenure
Loan repayment duration ranges anywhere between 1 year and 5 years in the case of a personal loan. If you are a younger loan applicant, then you may be considered to have higher employment as well as earning opportunities than the older one. So, in case you fall in the 20-year age group, you may be eligible to avail a personal loan for a higher loan duration than someone who falls in their 50s. Loan repayment tenure might even be extended if your age is less. Best banks for personal loan usually tend to offer you loans if you range between 21 and 60 years of age for a repayment tenure of up to 6 years after reviewing your credit profile and income.
Age and Loan Proceeds
Loan proceeds approved even is dependent on your age. In case you are a younger applicant, then you may be eligible for higher loan proceeds than other loan applicants.
Age And Rate Of Interest
Age usually has an indirect effect on the rate of interest offered to you as an applicant. In the case an applicant is young, you may require spending a few years in the job. Also, you must hold a good credit history to get loan approval. So, if you spent a higher number of work years and have a longer credit history, then your chances of availing personal loan approval are higher. So, the rate of interest might be lower if you are an older applicant than younger ones. Note that the lowest personal loan interest rates range anywhere between 9.25 – 10.75 per cent per annum at present.
Age and Repayment Potential
If you are one of those aged and approaching the age of retirement with no steady income source, then you may have lower approval chances for a personal loan. Lenders usually factor in your income stability to be an important parameter in approving your personal loan.
Why Must You Avail A Personal Loan Post-Retirement?
While the requirements tend to change with age, they still exist. You as a retiree might not be able to mitigate all your financial requirements with your savings. In adverse scenarios, if you may require additional funds, then you may consider opting for a personal loan. However, as you fall in the higher age group, your chances of getting loan approval may be exceedingly low. So, here, in this case, you must consider opting for a joint personal loan deal.
What’s The Solution For Retirees?
Clearly, retirees even hold the requirement for a personal loan. So, industry players must come up with distinct customized products to meet the needs of this population or segment. While you as a retiree might not hold the same income as you had during your prime working years, lenders usually take into consideration your distinct income sources such as –
Income from entrepreneurial activities post-retirement.
Income from investment
Income from pension
Income from retirement plans
Income from real estate investments
A huge number of retirees may be able to meet the EMIs with comfort and ease. A retiree must even approach a lender who provides personalized products within the niche category in place of opting for bigger banks.
Ending Note
Your age plays a massive impact on your personal loan qualification and eligibility. However, there are personalized products in the case of personal loans, which tend to cater particularly the aged.
Frequently Asked Questions (FAQs)
Which Parameters Impact Your Eligibility For A Personal Loan?
The parameters, which impact your eligibility for a personal loan are monthly income, credit score, age, debt-to-income ratio, employment status and relationship with the lender.
What’s The Eligibility In Regard To The Loan Age?
You must fall in the age group between 21 and 60 years.
Is Your Age A Crucial Parameter For A Personal Loan?
Yes, age is an important parameter that impacts your eligibility for a personal loan. You can avail a personal loan only if you fall between the age group of 21 and 60 years. As you slowly age, you even get experience, stability, and assets. All these parameters determine your eligibility for a personal loan and application approval chances.
What Are The Important Tips To Increase Your Eligibility For A Personal Loan?
A few of the important tips to increase your eligibility for a personal loan include –
Repay your existing debts or loans before placing an application for the new personal loan deal.
Make sure you make your payments of your existing loans and credit card outstanding balance in full and on time.
Keep a positive credit history by repaying your debt timely, ensuring a balanced mix of credit, and keeping your credit utilization ratio within 30 per cent.
Make sure your credit score is over 750.
In case your monthly income is low, consider showing your various income sources like variable pay, passive income, incentives, etc.
Can You Get A Personal Loan At 75 Years Of Age?
Yes, you can avail a personal loan by the time you reach the age of 75. However, only a few lenders may provide you with a personal loan because of your high age. Other lenders that agree to lend to you, usually do after analysing if you hold a reliable income source like income from investments, assets, real estate, retirement plans and others. The lenders also tend to factor in your credit score and your past credit record to approve your personal loan application.