Since Personal Loans are unsecured loans, lenders rely heavily on your CIBIL score to determine your creditworthiness. Your CIBIL score summarizes your credit history i.e. the amount of credit you have taken, your repayment diligence, and other credit-related factors. Hence, your CIBIL score helps a lender or a financial institution evaluate the risk associated with granting you a personal loan. Although having a good CIBIL score for a Personal Loan is important, you can still secure a Personal Loan despite a poor CIBIL score. At times, unexpected financial contingencies can affect your CIBIL score for the worse. If you find yourself facing such a predicament, here are some measures that will help you get a Personal Loan for low CIBIL score.
Personal Loan with Low CIBIL Score
- Prove That Your Income Can Support EMI Payments
- Apply for a Smaller Loan Amount
- Apply with a Guarantor or Co-Applicants
- Check Your CIBIL Score for Mistakes
- Offer Collateral
Prove That Your Income Can Support EMI Payments
If you want to apply for a Personal Loan with a low credit score, you will need to convince the bank that you are financially capable of making the EMI payments. For this purpose, you can declare additional sources of stable income like rent, salary, and commission etc. to convince the lender that you can afford to make the EMI payments. However, you may have to pay a higher rate of interest on your Personal Loan if you prove your eligibility in this manner.
Apply for A Smaller Loan Amount
A lender is more likely to refuse if you ask for a high loan amount with a poor CIBIL score. A high amount with a low credit score only indicates more risk for the financial institution. However, when you apply for a lower amount of a Personal Loan, the lender may feel more comfortable granting the loan as it will be easier to repay.
Apply with a Guarantor or Co-Applicants
If you have a low CIBIL score, you can apply for a Personal Loan by involving a co-applicant or guarantor. If a close friend or a family member is willing, you can ask them to become a co-applicant or guarantor for your Personal Loan. If your guarantor or co-applicant has a good credit score or a steady income, the bank will most likely grant you the loan.
Check Your CIBIL Score for Mistakes
At times, your low credit score can also be due to errors in the CIBIL report. Mistakes like the omission of the latest transactions or misrepresentation of certain information can take a toll on your credit score. If you haven’t checked your CIBIL report in a while, make sure to check it and correct mistakes in case you spot any errors. Rectifying the errors will boost your credit score and make you a better candidate for the loan.
As a last resort, you can also consider pledging assets such as property or jewellery as a guarantee to avail a Personal Loan. Doing so can improve your chances of getting a personal loan for bad credit.
These measures will help you avail a Personal Loan even if you have a low CIBIL score. However, ensure that you have sufficient funds for repayment before you apply for a Personal Loan. With Finserv MARKETS, applying for a Bajaj Finserv Personal Loan is easy, convenient, fast and completely hassle-free. What’s more? The entire process is online and with loan approvals within minutes. So, why wait? Apply for a personal loan with us today!
Read about benefits of availing personal loan online and get to know its advantages over offline personal loan.
Also get to know about applicable charges before and after availing a personal loan.
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