Did you know that lenders always compute a borrower’s ability to repay a loan by analyzing his/her credit score? It is given more emphasis, especially in the case of unsecured loans such as personal loans and credit cards.
Your CIBIL score is the mirror of your creditworthiness which a lender pulls out at the time of loan processing. Hence, a borrower needs to have strong CIBIL Score to get a loan approval at a lower rate of interest. Anything that reads 750+ is what lenders consider the suitable score to award the loan sanctioning at a lower interest.
What if you want a personal loan for poor credit score? Is it possible? Yes, you can still get a personal loan approval despite having a poor CIBIL score. Go through this post and know some quick measures to help you do that. Read on!
Prove That Your Income Can Make Ways For EMI Payments
Did you receive a salary increment recently or have an extra source of income? A creditor may consider your personal loan application despite a lower CIBIL Score. The only thing is that you will need to convince the lender that you have a steady job and can afford the EMIs. The downside of this is that you may have to bear a higher personal loan interest rate when you prove the credit eligibility in this way.
Borrow a Lower Personal Loan Amount
Applying for a higher amount when you have a lower CIBIL Score is asking for more trouble. A lender then may assume that you won’t be able to pay the loan on time and more or less default. Hence, they will not sanction the loan. On the other hand, applying for a much lower amount, a lender may feel safe and comfortable in granting the loan. It is because a lower amount is much easier to repay than a higher amount.
Apply With a Co-Applicant
If none of the aforementioned tips works, then the next thing that should work is applying for an instant personal loan for poor Credit Score along with a co-applicant. The advantage that may work in your favour to get the loan approval is that the co-applicant may have a steady income source and a better credit rating. If the lending institute finds it correct, then they may let you have the approval. Thus, when you need to opt for personal loans, check if you would need a co-applicant. It will help if you are falling short somewhere to get the approval for the personal loan for poor Credit Score.
Resolve Errors In Your Credit Report
Sometimes, your credit rating may be lower despite having paid all your existing and earlier EMIs and credit card outstanding on time. As a result, despite being a fit case, you may still not get personal loan approval. The culprit here may be some errors in your Credit Report which may not have been done on your behalf. It may be a case of missed or wrong entries into it. Mistakes like these may take a toll on your CIBIL Score which may further not let you enjoy a smooth loan approval at a lower interest rate. The best thing that you can do in this regard is getting corrected all such errors. It will boost your CIBIL Score and deem you like the fit case to get the personal loan approval easily.
These are some of the key measures that may help you get a personal loan for poor Credit Score. Nonetheless, you should ensure that you have enough resources or funds to make repayments. If not, your CIBIL Score will take the beating further and will be doomed. If you are still unable to get a personal loan for poor Credit Score, you should check if you can put down some assets or collateral to get the loan approval.