Engineer Loans bring you a host of benefits to support you through thin periods and help you to finance all your needs as a professional. The important aspect is that you must make sure to fulfil all the eligibility criteria required to avail such a professional loan.
Most people believe that it is an easier option for a professional to get loans, but it is a misconception. Approval of a loan doesn’t depend on any professional qualification or degree, but there are undoubtedly other factors that sanctioning of a loan directly depends on. Put yourself in the lender’s shoes and try to find answers to the queries a lender might make. This will boost your chances to have your loan approved with good interest rate on engineer loan. It is also a wise approach to find out the reasons beforehand for which an application for an engineer loan or just any loan can be rejected.
Here are some of the most obvious ones:
1. Frequent borrowing habits: Financial institutions often hesitate to offer loans to borrowers bearing several loans under their names, as it is believed that they are more likely to be defaulters. It is often inferred that such applicants are overleveraged and a new loan will overburden them financially, and thus they end up facing rejection of their application for a loan.
2. Poor CIBIL record: It is a mandatory procedure to scrutinise the credit score of the applicant to evaluate how much creditworthy the candidate is. Unless the CIBIL score is 750 or more, it is almost impossible to avail an unsecured credit. There are also scenarios where, in spite of having a 750+ CIBIL score, the application gets rejected, but still the primary approach must be to know how engineers can increase their CIBIL score.
3. Individual comments on CIBIL report: Even if the CIBIL score is up to the mark, loans can still be rejected because of some special comments on CIBIL report based on some observations. If a lender takes notice of such comments, then it can hurt one’s chances of getting a loan sanctioned. Such negative comments crop up as a borrower goes ahead and settles the loan by deviating from the terms and condition or have the habit of paying EMIs after Days Past Due (DPD), or requests to lower the rate of interest at the middle of the tenor, etc.
4. Irregular tax payment history: A lender always prefers candidates who have always filed income tax returns at regular intervals during the last couple of years before applying for a loan. Hence, if there are any adverse findings in this respect, it is a question over your credibility and will pose a barrier towards the approval of your application.
5. Unstable career or employment: One of the most important factors behind the rejection of a professional loan is instability in any form, especially in the professional front. This tends to have a damaging impact on your CIBIL Credit Information Record. Instability of the company you work with or the habit of job hopping can also damage your creditworthiness. Lenders often give a miss to candidates having job or lifestyle bearing unstable nature.
6. Guarantor of a defaulted loan: This is one of the most pathetic reasons to reject a loan application. In spite of having a good track record, favourable credit score and after fulfilling all the criteria, the application gets rejected just because you have been a guarantor to a loan that defaulted in the past. So, it is recommended that if you have received a request to be the guarantor for a loan from a close acquaintance, don’t go ahead blindfolded but ensure to recheck the capability of the borrower to repay the advances. Or, else you might end up losing on all the advantages such as getting a good interest rate on engineer loan or any other loan for no fault of yours.
If you are sure enough that you are not under the threat of any of the reasons for loan rejection mentioned above, then you can apply for your engineer loan from a noteworthy financial institution like Bajaj Finserv. You will get numerous benefits like high loan amounts ranging up to Rs. 25 Lakh for salaried engineers and up to Rs. 30 Lakh for self-employed engineers. Apart from that, there are options for individual personal and business loan categories for engineers.