5 Ways You Can Bag a Personal Loan Despite Low CIBIL Score
A CIBIL score of 750 or above is mandatory when you apply for an unsecured loan. Your credit score ascertains your creditworthiness. A high credit score makes you more eligible for a loan.
According to CIBIL, 80% of all loans sanctioned since 2014 were to borrowers holding a minimum credit score of 750.
However, financial institutions provide personal loans for low CIBIL score customers. There are ways you can apply for these loans with a low credit score.
These Include:
- High income
Financial institutions may sanction you an instant personal loan if you have a high income even if you have a below-par credit score.
However, you may not be able to avail a high loan amount if your monthly expenses are high. Lenders check your debt-to-income ratio to assess whether you will be able to pay your loan EMIs after meeting your fixed monthly obligations.
Ideally, the debt-to-income ratio that financial institutions prefer is 50% or less. A lower ratio makes you more eligible for the loan.
2. Pre-approved offer
A pre-approved offer is a loan amount that you may avail of based on your income and current credit score. The majority of NBFCs provide these offers which you can avail from their website.
3. Joint loan
You can apply for a personal loan for low CIBIL score jointly with a co-applicant. This co-applicant can either be your employed or self-employed spouse or parent. Your chances of availing the loan increases even more if the joint applicant holds a good credit score.
4. Opt for a lower amount
Asking for a lower amount when you have a bad credit score makes the loan less risky for the lender. You will also not encounter any hassle when repaying the loan.
5. Apply with an NBFC
NBFCs have less stringent rules and regulations when it comes to sanctioning loans. They may approve your loan even if you hold a low credit score.
Take into account these factors when you apply for a personal loan for a low CIBIL score. Make sure you are in absolute confidence in the loan before applying.
Must Read: Five Ways You Can Bag Personal Loan Despite Low CIBIL Score
