Basic Eligibility Criteria for Obtaining a Personal Loan in the UAE

A personal loan is an unsecured loan offered by the several banks & financial institutions to any individual who meets the eligibility criteria pre-decided by the bank. A personal loan is indeed the best option to fulfill your financial needs or to meet emergency cash needs. Be it international holidays, wedding planning, higher education, home renovation, a personal loan can fulfill all your personal needs instantly.

Availing a personal loan in UAE is quite easy but if you don’t submit the required documents & meet the eligibility criteria, your loan application may get rejected. That is why it is absolutely essential to know all the factors that determine your eligibility criteria for a personal loan before you apply for a personal loan in UAE.

Here in this article, we have mentioned some common eligibility criteria that you need to meet in order to apply for a personal loan in UAE:

  1. Age of the Applicant

Age is one of the most important factors of personal loan eligibility. The younger you are, the higher is the probability of you availing a personal loan since you’ve many earning years in front of you to make the repayment of a personal loan. General guidelines followed by the majority of the banks or personal loan lenders for salaried individuals is that their minimum age should be 21 years while the maximum age is 60 years. However, for self-employed, the maximum age depends on the bank/lender you approach but it could be as high as 65 years.

So, if you applying for a personal loan at the old age, the chances of your personal loan getting approved are lower. Because the bank/lender considers that you might not be able to repay the loan amount at your older age. But if you’re at the younger end of the age bar, lenders will immediately offer you a personal loan to you as long as you meet the eligibility criteria.

  1. Employment Stability

This is one of the most important factors that is highly considered by the banks/personal loan lenders before sanctioning a personal loan in UAE. In order to meet the eligibility criteria, you need to be salaried or self-employed.  However, the personal loan eligibility requirement for salaried individuals is quite different from the individuals who are self-employed.

A salaried individual needs to have a minimum of two years of working experience and he/she should have spent at least 6 months in the current organization. While a self-employed person is eligible for a personal loan in UAE if he/she has a minimum of five years of total experience and minimum of two years of experience in his/her current business. These are the general guidelines followed by the majority of the banks & financial institutions in the UAE. However, these numbers are absolutely flexible, differs from bank to bank. But there is one thing that is applicable for all banks/lenders that they might be hesitate to sanction a personal loan to a person who is fresher at work.

  1. Income Criteria

Your monthly income is also something that banks or personal loan lenders always look into before sanctioning a personal loan. The loan amount that gets offered to the borrower is based on his/her earning.  So, the more your annual income, the higher personal loan amount you will be eligible to get as lenders perceivers you as someone with the great repayment ability.

Well, every bank/lender has its own income eligibility criteria. To get your personal loan application approved, you should be aware of the minimum income required by the lender.

  1. Credit Score

Your credit history or credit score plays a major role in determining your eligibility criteria for a personal loan since it holds a great value. Having a good credit score increases the chances of getting a low personal loan interest rate, flexible tenor options, and high loan amount. If in case the lender finds you at risk with huge outstanding dues, default & delay payment records, or fraud track records then the lender has a full right to reject your loan application. All these things lower down your credit score. And the lower your credit score, the lower your chances of being eligible for a personal loan. So, make sure you maintain a good credit history before you apply for a personal loan in UAE because a good credit score is vital to be eligible for a personal loan.

  1. Salary Transfer

Most of the banks may also require that the applicant’s salary should be transferred to an account held with them or any other bank’s account in order to be eligible for the personal loan in UAE. This is because they want to see a stable & secure income with adequate income proofs. So, if you earning a good amount of salary but getting it through cheque or cash then the bank might hesitate to sanction you a personal loan since banks need adequate evidence to support your loan amount.

  1. Employer’s Reliability

This is yet another major factor which plays a vital role in deciding the eligibility criteria for a personal loan. The employer for which you are working will also play a vital role in determining if you will get a personal loan. Working with a well-renowned company who has a good reputation in the market always helps you to avail a low personal loan interest rate. Through this, the bank/lender can easily judge your credibility and are assured that you will make the loan repayment on time.

In A Nutshell

Here you have the criteria that determine the eligibility for a personal loan in UAE. You can go through all the above-mentioned points in order to make a wise decision. Well, each bank/lender has its own eligibility criteria for age, income, employment type, job status, credit score, etc. So, you will need to meet these eligibility criteria in order to apply for a personal loan in UAE from a particular bank or lender.