Loan even with low credit: Apply to NBFC or fintech lender, know 3 ways to get loan with low credit
A credit score, also known as CIBIL score in common parlance, is important for qualifying for a loan or a credit card. A CIBIL score above 700 is generally considered good. The higher your score, the higher the chances of your loan application being approved. Most banks and NBBCs collect your credit score and report from CIBIL when you apply for the loan.
In case of a low CIBIL score, the application can also be cancelled. But what if you have low/bad credit and need an emergency loan? Or if you are a new customer and you have no credit score? So how will you get the loan?
If you have a low CIBIL score, you can apply for a loan from NBFCs or fintech lenders. NBFCs and Fintechs also offer loans to customers with low credit ratings. However, their interest rates are usually much higher than bank interest rates. It is also important to note that if you apply to a bank and the application is rejected, it can further reduce the CIBIL score.
If the CIBIL score is lower, you can apply with the co-applicant. A co-applicant can be a family member with a good credit history and good income. Adding a co-applicant reduces the lender’s credit risk. Indeed, the co-applicant is also responsible for the repayment of the loan. You can also appoint someone with a good credit rating as a guarantor.
Apply for small loans if you have a low credit score. Taking a small loan and paying it back will help boost your credit score. Once you have a good credit rating, you can apply for a large loan from any bank. Some banks and financial institutions offer secured loans to low credit score holders. Secured loans include gold loans, property loans or title loans.
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