Eligibility for a Personal Loan in Dubai

A personal loan is the most convenient way for a salaried person to get bank finance to meet their financing need. Getting a personal loan is easy if you have all the required documents with you to meet the eligibility criteria of a designated bank. Apart from having all the documents with you, the personal loan request might get rejected due to poor Al-Etihad Credit Bureau Score (AECB) which plays a critical role. Most banks reject the loan application if your employment history is less than six months. There are several factors to calculate the eligibility for a loan without the consultation of bank these factors include:

·         Your Credit Score

·         Your Employment History

·         Debt Burden Ratio

What is Debt Burden Ratio?

DBR is the key element in order to determine the eligibility for a personal loan. In simple words, it is Debt to Burden ration, your income versus your liabilities. Your DBR score should not exceed more than 50 as it is made compulsory by the Central Bank Regulation. While calculating DBR scores should include all previous loans, credit card details, auto loan, existing loans or any instalment product you may have.

Your Credit Score

Your credit score can be obtained from Al-Etihad Credit Bureau by paying the fee of 100 AED. Credit score determines the risk of getting defaulter and it is based is usually between the ranges of 300-900. For instance, if you have a credit score below 300 then you are more likely to be rejected for a personal loan.

Employment History

The applicant should have an employment history of at least 6 months in the current organization. In most cases, the application is rejected by the bank if you have an employment history of fewer than six months. But there are few banks who can accept your personal loan application irrespective of your employment history.  

Once you are cleared with all the factors mentioned above, there is a checklist of basic documents required in order to process your personal loan as mentioned below

1.    Latest salary slip including all allowances, bonuses etc.

2.    A basic requirement of six months service history as demanded by most banks.

3.    The minimum salary requirement by the bank. The minimum limit varies according to the bank.

4.    A service letter from your employer clearly mentioning the enrollment date, your salary, designation and end of service benefits from the employer.

5.    National ID or a passport in case of a foreigner.

6.    Duly filled application form of the designated bank and it should be complete in all respects.