For obtaining a loan or credit card, one must have a credit score, usually referred to as a CIBIL score in everyday speech. A CIBIL score of 700 or more is generally regarded as good. Your chances of having your loan application accepted increase with your score. When you apply for a loan, the majority of banks and NBBCs pull your credit report and score from CIBIL.
Application cancellation is also an option in cases of low CIBIL scores. But what if you require a loan for an emergency but have a low or terrible credit score? Or perhaps you’re a brand-new client without a credit history? How will you obtain the loan then? Here are a few strategies you can use to try to get a loan even if your credit score is low:
Contact an NBFC or Fintech Lender.
Loan even on low credit score
You can seek a loan from NBFCs or Fintech lenders if your CIBIL score is poor. Loans are also made available to borrowers with bad credit by NBFCs and Fintechs. Their interest rates, however, are typically significantly higher than those of banks. It’s also crucial to keep in mind that your CIBIL score can be further affected if your application for a bank is denied.
Apply with co-applicant
If your CIBIL score is below average, you may co-apply. A family member with a solid credit history and steady income might be a co-applicant. Including a co-applicant lowers the lender’s credit risk. This is due to the co-shared applicant’s responsibility for loan repayment. Additionally, a trustworthy individual might serve as a guarantor.
Choose Small or Secured Loan Option
If your credit score is low, apply for a modest loan. By taking out a little loan and repaying it, you can improve your credit score. When your credit is good, you can apply for a sizable loan at any bank. Some financial institutions and banks provide secured loans to people with low credit scores. Gold loans, loans secured by property, and loans secured by securities are examples of secured loans.
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