Taking a loan is a very common thing these days. It is a very simple process where you need to go to the bank with all the necessary documents and ID proof. If they think that you are a genuine person who will be able to return the money to the bank, they grant you the loan. In fact, people nowadays take a loan for innumerable things such as a new home, education or even a new car. While you are told to pick a bank after clearly studying the interest rates and other things, you should also know about factors that a banker considers before giving you a loan.
- Your personal as well as professional details: I am sure that you are aware how a loan works. You first take the money from the bank and then return it with the interest charged on it at regular intervals. This is why your personal as well as professional details matter a lot. Some elements such as your age, your monthly income, your capacity to spend as well as your post in a company are all considered by the banker before he or she decided to give you a loan.
- The reason for which you want a bank loan: Some of the most obvious and common reasons have already been stated above. But, have you thought of a start-up? That is also an avenue where people need to take loan so that they are able to fund them initially. This is where the banker sees how real or achievable your goal is. If the banker feels that your plans do not have the potential to materialize, then the banker has the right to reject your application for a loan. This is why you need to be clear about your reason and need.
- What is your financial status? It is obvious that you need a loan in the first place because you do not have that kind of money on you at the moment. But, still you need to have a minimum earning capacity according to your profession. The bank will be able to guide you best regarding the various professionals and what is the requirement. In fact, your industry of work is also a major influencing factor. You need to be sure about one fixed sum that you will be returning each month. Only then is the tenure decided for the loan that you are planning to take.
- Do you know the market well enough? This is reference to the fact that do you know your competition well? Are you able to identify the business tricks and gimmicks that are used by other companies in your industry? If yes, this means that you will be able to move ahead of them. This way, your income is bound to increase and the bank will also keep receiving the installments on time.
These are some of the major factors that influence a banker before he or she gives you a loan.