Credit Score or CIBIL Score is a very important criteria in getting a Personal Loan. If you have a low CIBIL score, chances of getting a personal loan are very low. However, a personal loan can be availed even with a low credit score. There are certain methods to follow.
A score ranging from 300 to 900 is usually given. A credit score of 750 and above is considered excellent. 550 to 750 can be called decent credit score. Banks consider a score below 550 as a poor score. Getting a personal loan is very difficult if the credit score is poor. But you can avail personal loan by following the methods given below.
Personal Loan : Prove EMI paying ability
Apart from the credit score, the income of the applicant is also evaluated while applying for a personal loan. You have the ability to pay EMIs even if the credit score is not good. You have to convince the bank that you can pay the EMI properly. If there are technical reasons for poor credit score, then you can convince the bank about that too. You can get a personal loan if you guarantee to the bank that you have a permanent job and are getting a certain amount of salary.
Apply with guarantor
You can apply for a loan with a guarantor in case the credit score is not good. This guarantor is the guarantor for the loan you avail. In this case the bank will consider their credit score and take them into confidence. If the bank is confident that the loan will not default then the bank can give you the loan.
Try for a mortgage loan
If you have a bad credit score, you can get a loan against property or jewellery. This also works as a guarantee. In this method, the property has to be pledged to the bank instead of the guarantor. If the loan is not repaid, the bank can sell your property and collect the money.
Application for Small Amount Loan
Even if you have a poor credit score, banks are likely to reward you if you apply for a small loan. Because the bank does not have much risk by giving a small amount of loan.
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Correct any errors in the credit score report
Sometimes, technical errors and omissions in a credit report can lead to a poor credit score. This affects your chances of getting a loan. Check credit report online regularly. Correct an error found on a credit score report immediately. This makes it easy to get a loan.
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