Of the several products that the Indian financial market brings, a loan for doctors is designed to meet the specific needs of medical practitioners. The fund can be utilised for diverse purposes starting from expansion of clinic to investment in modern equipment.

The credit, however, proves beneficial when repaid in time. Again, repayments are largely impacted by the doctors loan interest rate you accrue.  Before availing a doctor loan, it is crucial to check out the factors that affect the interest rates.

5 factors affecting doctors loan interest rate

1. CIBIL score 

As a doctor’s loan is usually unsecured in nature, the CIBIL score plays a crucial role in assessing an applicant’s creditworthiness. It is the numerical form that shows how you have managed money before. The more you make payments on time, the more points you add up to your credit score.

Issued by TransUnion CIBIL, the CIBIL score is assessed on a scale of 300 to 900. Applicants must hold a rating of 750 or above to qualify for credit. Scoring closer to 900 shall entitle them to lower interest rates. On the contrary, a lower credit score leads to higher interest rates as you pose as a risky borrower to the lender. Check out what should doctors with a low score do. Hence, try to maintain a healthy score for quick approvals and affordable rates.

2. Credit history 

Apart from the CIBIL score, credit history validates an applicant’s financial behaviour elaborately. It is mentioned in a credit report which shows all the details of previous debts, existing liabilities, payments, defaults, etc. along with personal, public and enquiry information. Credit report also helps evaluate an applicant’s overall borrowing capability.

Pay all bills on time, make time EMI payments, pay off debts and keep no record of default. If you maintain a clean credit report, lenders may offer you preferential loan interest rates. Also, know the quick steps to get your doctor loan approved easily.

3. Monthly earning   

Lenders consider income as another major factor that assures your loan repayment capability. Higher earnings signify you have a strong financial stand and are in a stable condition to repay without default. This gives you an upper hand to negotiate for a reduced doctors’ loan interest rate.

4. Reputation 

When it comes to determining interest rates, reputation can impact decisions. If you are a renowned doctor practicing at a reputed healthcare facility, you might end up with lower rates of interest. The reason being lenders consider you to have a stable career with financial constancy. Your potency to make regular and timely repayments is, therefore, high.

Here, your reputation with the lender may also impact the interest rates. If you have stayed loyal to the financing company and made structured repayments, the lender is likely to retain the relationship, and offer lucrative rates on doctors loan scheme.

5. Eligibility criteria 

Last but not the least; applicants must mandatorily fulfil the eligibility criteria set by lenders. These will qualify you not only for the credit but also for lower doctors’ loan interest rates. As per the standard parameters, you should be any of these:

• Medical-council registered MBBS degree for PG Diploma, Post-graduate, specialised diploma and super-specialist degree holders
• Post registration with the medical council for MBBS degree holders
• BHMS/BAMS degree holders must have 2 years of experience from the medical registration date
• Dentists or MDS degree holders should possess 5 years of experience from the date of medical registration

How to avail of a doctor loan in India? 

The step-by-step guide on how to apply for a doctor loan is easy but varies with lending institutions. Most reputed NBFCs like Bajaj Finserv accept online loan applications and ensure quick processing. Borrowers need to meet the eligibility criteria, fill up the form with accurate details and submit along with a few documents.

They also provide pre-approved offers specifically for existing customers. Pre-approved offers are designed to make the loan application process simplified and less time-consuming. These pre-approved offers can be availed on business loans, personal loans, professional loans and a host of other financial products. Check your pre-approved offers by submitting a few details online.

Taking a loan is a major financial commitment that requires strategic planning. Instead of applying randomly, prepare yourself for the credit and lower doctor loan interest rates. You can then repay the principal outstanding along with total interest payable in small and affordable EMIs conveniently.