Pre-approved loans can be defined as instant personal loans. These are readily available loans with a financial that has already scanned its existing customer’s financial details for a loan sanction. If an individual maintains an excellent CIBIL score, the lender can consider them to offer such instant personal loans. 

The pre-approved personal loan amount can be transferred on the same day of application submission as the lender already has checked your ability to repay the loan. 

An individual can check pre-approved loan offers at the official website of the lending institution and apply online for these instant small loans.

How Pre-approved Loans Work?

• A pre-approved loan is based on an individual’s information provided by credit bureaus that assign credit scores to the borrowers, like CIBIL. Generally, an existing customer of a financial institution can avail of pre-approved Loans. However, while you apply for a loan with other lenders than the older one, you can still check for pre-approved loan offers. The financial institutions generally obtain credit history reports of numerous borrowers from credit bureaus and can provide you with a pre-approved loan offer based on your score and eligibility. Personal loan for low CIBIL score can be availed of at a higher interest rate relatively.

• Pre-qualified loans are different from pre-approved loans. Pre-approved is more committed than a pre-qualified loan. Prequalification is just the first step of loan processing, where the institution asks you to fill out a detailed questionnaire to know your loan preferences and purposes. On the contrary, a pre-approved loan is ready to be processed loan based on your verified credit history after the prequalification step. 

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Thus, repay your loans and credit card bills on time to maintain a high credit score and avail of pre-approved loans.