The pre-approved loans are the ones that are first only approved by the bank to the borrower. The individual who holds a bank account in the bank can get pre-approved loans by the bank depending on the eligibility of the salary of an individual. The loans can be taken from the same borrower where an individual holds the account. The bank based on an individual CIBIL score approves the loans of an individual and also on the amount of the loans which the borrower can get approved from the bank. The borrower can avail of the loans without the documents as the bank is having KYC details with them so the borrower can get the loan on an immediate basis. The borrower can get fast approval of loans by the bank and immediate disbursement of the loans can be done by the bank. Thus pre-approved loans help an individual to plan for the early purchase of the housing by an individual. The home loans can be taken from a specific bank only from where the customer is having a bank account. The loans thus taken can be used for the purchase of the house.

Pre-approved loans can thus be approved in case of the good maintenance of the bank balance and also good credit history. The bank before approving the loans checks for the overall credit history of the borrower based on the timely payment of the credit card bills and also maintenance of the good credit score of the companies. The loans are approved at lower interest rates of around 6.50% per annum onwards. The bank has the assurance that the borrower would repay the loans on time for the loans being taken. The bank charges nominal processing fees for the loans being approved. The borrower has to give the approval for the loans to the bank for the disbursement of the loans. In a very rare case, some other banks may approve loans to the borrowers at lower interest rates than the existing lenders. The loans obtained at lower interest rates can be beneficial to the borrower as it helps the borrower repay the loans faster. Also, lower interest rates help the borrower reduce the burden of the repayment of the loan as the lower interest rates mean lower repayment of the loans. The banks send a reminder to the prospective clients who can avail the loan approval on an easy approval process.

Benefits of the pre-approved loans

  • Pre-approved loans can be approved without any documentation by the borrower.
  • Loans can be taken at lower interest rates by the borrower and also with faster approval of loans.
  • The bank can provide flexible terms and conditions in the favor of the customer who can avail the loans easily from the bank.
  • The borrower can avail of tax benefits under income tax act 80C and section 24 and 80EEA.
  • The faster approval and disbursement of the loans can be done to the borrowers who avail of pre-approved loans.
  • The loans are provided only to the high-value customers of the bank who maintain sufficient bank balance in their bank account and also the ones who are honest payers of credits. Thus getting pre-approved loans is a major positive symbol of a good customer of the bank.
  • The pre-approved loan application can never be rejected as the bank firstly verifies the background of the borrower and only after that provides the pre-approved loans option to the borrower.
  • The bank approves the loans according to the income eligibility of the borrower but in the case of the pre-approved loans, the loans may get approved of the higher limit as well. Thus the borrower can take the benefit of higher credits in pre-approved loans.
  • Availing frequent credits and also the mixed type of credits can help the borrower improve the CIBIL score even better thus making eligible for the easy approval of credit cards and loans.

We can conclude that taking a pre-approved loan is a better option than availing loans from a different lender else than where the borrower holds the account. Also, the borrower can avail of tax benefits for the home loans. Thus taking pre-approved home loans is a better option to buy the dream home.