How Can A Person With A Low Credit Score Get A Personal Loan? | MoneyInMinutes

1. HOW CAN A PERSON WITH A LOW CREDIT SCORE GET A PERSONAL LOAN? When you're in a pinch for cash, an instant loan online might be really useful. However, before such a loan can be approved, you must pass a series of tests conducted by the lender. You can use the personal loan eligibility checker to find out how much money you're qualified for. Before approving a personal loan, a lender would look at your credit history. This is why having a low CIBIL score may make obtaining a loan difficult. Personal loans for people with low CIBIL scores are, nonetheless, accessible, and they can apply for one by following the necessary steps. Is there no way to get a personal loan if you have a poor CIBIL score? With a poor CIBIL score, acquiring a personal loan may be more difficult, but with some effort, you could be able to get one. But first, let's define a CIBIL score and how it affects personal loan eligibility. Cibil score and its importance Your creditworthiness is determined by your CIBIL score. The Reserve Bank of India (RBI) has approved the Credit Information Bureau (India) Ltd., usually referred to as CIBIL, to generate this score for an individual. A genuine CIBIL score ranges from 300 to 900, with 900 signifying the highest level of creditworthiness. The higher your credit score, the more likely your loan application will be accepted. A loan for low CIBIL score is determined by how well you repay your previous loans. You can maintain a high credit score by making on-time payments on all of your existing debts, such as credit cards, loan EMIs, and so on. Defaulting on debt, on the other hand, lowers your credit score. CIBIL defaulters are more likely to be denied personal loans than those with a good credit history. Getting a Personal Loan When You Have a Bad CIBIL Score Even though it will be difficult, you can still receive a personal loan with a bad credit rating if you follow the steps below: 1. Provide proof of income to back up loan repayments You may have a poor credit rating, but a raise in salary or the addition of another source of income may persuade the lender to consider your loan application. Furthermore, if you can demonstrate that you have a stable job with a consistent revenue stream, your chances of obtaining a loan will improve. You should be aware that you may be charged a higher interest rate. 2. Think about getting a small personal loan. If you request a large personal loan amount with a poor CIBIL score, your lender may view you as a high-risk applicant because your chances of defaulting on the loan repayment are high, according to

2. the lender. If the personal loan is for a smaller sum, the lender may be more willing to approve the request. In addition, repaying a reduced sum for instant short term loans ill be much easier. 3. Obtain a guarantor or apply for a joint loan. If your CIBIL score is poor, having a co-applicant or guarantor with a good credit score can help you receive a personal loan faster. Ensure that the KYC processes are completed, together with the requisite signatures on the relevant paperwork, with authorization from your co-applicant or guarantor. When a lender finds a co-applicant or guarantor on your loan application with a decent CIBIL score, it surely helps you get a better deal. 4. Identify and Correct Credit Report Errors With a poor CIBIL score, you may find it difficult to obtain a personal loan. However, there is a chance that your credit report contains mistakes or misreporting. This is most likely because your record hasn't been updated with the most recent information. While it is not your responsibility, blunders like these can lead to unwelcomed consequences. Check your CIBIL score on a frequent basis to stay ahead of the game. If you identify any inaccuracies, make sure to report them to the appropriate authorities as soon as possible. Finally, it will benefit you by improving your credit score, making you a more suitable candidate for a personal loan. 5. Request that your lender consider your case if your credit report shows a NA or NH. An NA or NH on your credit report indicates an inactive credit period in the last 36 months or the absence of a credit period during the same period. This means you won't have a credit score on your CIBIL report at all. Explain to your potential lender why there has been a time of credit inactivity. It's possible that the loan will be granted at a higher rate of interest. Conclusion You can either start building your credit history, which is a time-consuming process, or you can look into the above mentioned pointers to improve the CIBIL score. Please keep in mind that even these choices will be difficult to obtain because most lenders want a strong credit score before considering a loan application. Original Source: https://blog.moneyinminutes.in/how-can-a-person-with-a-low-credit-score-get-a-personal-loan/