How To Get A Personal Loan With A Co-Applicant

Personal Loans are a popular financial tool in India, used to fund various expenses, from weddings to medical emergencies. They provide borrowers with access to funds for various purposes without providing any collateral. Nowadays, people have been considering taking a Personal Loan with a co-applicant. But is it beneficial? How does one apply for it?
 
This blog explores the importance of having a co-applicant in a Personal Loan and the advantages of having a co-applicant, and the mandatory eligibility criteria. Additional factors to consider before taking a Personal Loan with a co-applicant and how to apply for a Personal Loan with a co-applicant are listed below:

Co-Applicants in a Personal Loan

It is very important to understand the meaning of co-applicant. A co-applicant is a person who applies for a loan along with the primary borrower. They share the responsibility of repaying the loan amount and are equally liable in case of default.
 
Having a co-applicant for a Personal Loan can increase your chances of approval as it helps mitigate the risk of lending to a single borrower. The co-applicant must have a good credit score and income to support the loan application. The co-applicant can be a spouse, parent, sibling, or close friend.

Also Read: How Can I Get A Loan For Personal Use  

Factors To Consider Before Taking a Personal Loan With a Co-Applicant

Before applying for a Personal Loan with a co-applicant, there are several factors that you must consider, including:

1. Credit Score

   The primary borrower and the co-applicant must have a good credit score to be eligible for a Personal Loan. A good credit score indicates a higher level of creditworthiness and helps lenders assess the risk of lending money. 

2. Income

   The income of the primary borrower and the co-applicant determine the sanctioned loan amount and EMI amount. It is important to have a stable income source to ensure timely loan repayment.

3. Debt-to-Income Ratio

   The debt-to-income ratio is the percentage of your monthly income that goes towards paying debts. Maintaining a low debt-to-income ratio is important. The borrower ensures that the loan amount is affordable and timely repayable.

4. Purpose of Loan

   Having a clear purpose for taking a loan with a co-applicant is important. You should avoid taking a loan for unnecessary expenses and only borrow what is necessary.

5. Repayment Plan

   Before taking a loan, it is essential to have a repayment plan in place. It would help if you discussed how to repay the loan, including the monthly instalments amount, loan duration, and other fees. 

Advantages of Having a Co-Applicant

Having a co-applicant for a Personal Loan can offer several advantages, including:

1. Increased Eligibility

   A co-applicant can enhance the primary borrower's creditworthiness, making them eligible for a higher loan amount.

2. Lower Interest Rates

   Lenders will likely offer lower interest rates to borrowers with a co-applicant as it reduces risk.

3. Better Repayment Terms

   Co-applicants can improve the loan's repayment terms, making it more affordable.

Eligibility Criteria for Taking a Loan with a Co-Applicant

Borrowers must meet the following eligibility criteria to qualify for a personal loan when applying for the same with a co-applicant: 

1. Age

   The co-applicant should be 21 years of age.

2. Relationship

   The co-applicant must have a family relationship with the primary borrower. Co-applicant can be spouses, parents, or siblings.

3. Income

   The co-applicant's income should be sufficient to support the loan repayment and the primary borrower's income.

4. Credit Score

   The lender also considers the co-applicant's credit score. A good credit score increases the chances of loan approval and may result in better loan terms and interest rates. 

Documents Required for Taking a Loan with Co-Applicant

The co-applicant must submit all the necessary documents required by the lender, such as:

• Identity proof such as Aadhar card, PAN card for KYC
• Address proof such as electricity bills
• Income proof such as salary slips of the last six months and Form 16
• Passport-size photographs
• Bank statements

How to Apply for a Personal Loan With a Co-Applicant

Follow the steps given below when applying for a Personal Loan with a co-applicant from Hero FinCorp:

• Begin with an online application that will require you to enter details 
• Upload your income proofs and basic KYC documents.
• If your information meets set eligibility requirements, one of the lending institution’s representatives will contact you for the completion of the next steps.
• After completing the entire process, the funds will be credited shortly to your account.

Benefits of Our Loan

Apply for a Personal Loan from Hero FinCorp and get a hassle-free application and approval process. Our Loans offer a variety of benefits, such as:

• Higher loan amounts up to Rs 5 lakh
• Flexible usage
• Collateral-free loans
• Competitive interest rates

Conclusion

If you are considering a Personal Loan for low CIBIL, then a co-applicant is a good option to apply for a loan with. Taking a Personal Loan with a co-applicant can be a smart financial decision, provided you understand the risks and have a clear repayment plan.
 
By choosing the right co-applicant, meeting the eligibility criteria, and carefully considering the factors involved, you can secure a loan that meets your needs and helps you achieve your financial goals.