There is a widespread notion that if you have a bad credit rating, you can kiss your chances of getting a personal loan goodbye. The fact is that there are definitely ways for you to get a loan sanctioned even if your credit history is not up to the mark. Let us look at some real scenarios and debunk the popular personal loans and bad credit score myths.
Debunking Personal Loans and Bad Credit Score Myths
1. You Don’t Need a Very High Credit Score to Secure a Personal Loan
If you have a few black marks on your credit history like delayed payments or foreclosures, there’s no need to despair. You can get a personal loan with low credit. Not all lenders will reject your loan application based solely on your credit history. There’s no harm in applying for a loan even if your credit score is poor. It is most likely that you will be approved for a loan either way, since banks and financial institutions look at the borrower as a whole and don’t consider just his past credit score.
2. Collateral is not Always Necessary
Banks and financial institutions can demand collateral in the form of personal or financial assets. This is done in order to safeguard themselves against borrowers in case they are unable to pay back their loans.
One of the biggest myths about bad credit and personal loans is that banks will always demand collateral if you have a poor credit score. The truth of the matter is that, collateral is required only in the case of secured loans. In case of unsecured loans, there’s no collateral required and most personal loans are of this nature. Therefore, you can easily get a loan even if you do not have any collateral to secure it against.
3. Repaying Your Loan can be Tension-Free
If you have a bad credit history, your greatest concern maybe that you will not be able to adhere to the repayment terms and conditions. Here, it becomes essential to set a good agreement with your lender for good clarity and flexibility regarding your EMIs. Monthly payments can be arranged and should be given precedence over lump sum repayments that can cause a financial crunch.
4. Build on Your Credit Score before Applying for a Personal Loan
If you are really concerned about your credit rating and you know that you will need to apply for a personal loan in the future, then there are ways of improving your credit score. The first thing to do would be to budget properly and keep on track with your credit card bills without missing any payment dates. Another trick is to keep old credit cards open even if you are done paying them off. This is because they represent unused available credit that will reflect positively on your credit score.
5. Bank is not the only source of Personal Loan
Apart from banks, personal loans can also be availed with the help of Non-Banking Financial Companies (NBFCs). Due to the increasing competition in the financial sector, various NBFCs offer instant personal loan online with competitive interest rate and attractive terms.
6. Personal Loan can be taken more than once
A personal loan is a multipurpose loan. Therefore, you can avail a personal loan more than once for different reasons. Be it managing medical expenses, wedding expenses, funding Children’s education, etc., a personal loan can prove to be extremely helpful.
7. Loans can help you shrink your debt
A personal loan can also be used for debt consolidation. This can help you shrink your debt and increase your financial flexibility. Mostly, personal loans are used to consolidate credit card debts. This is because the interest rate charged on personal loans is comparatively lower than the interest levied on credit cards. Hence, consolidating credit card debt by using a personal loan can help you save a large amount of money in the long run.
8. Personal Loans have Low Interest Rates
With leading financial institution, you can avail a personal loan at competitive interest rate. Moreover, if you have a high credit score, you can negotiate with the lender to avail more attractive rate and favorable terms.
9. Personal Loans can be availed if you have an existing Loan
If you have a good repayment history and meet the eligibility criteria set by the lender, you can avail a personal loan even if you have an existing loan.
10. Not only Salaried Person can apply for Personal Loan
Salaried, as well as self-employed individuals, can avail a personal loan provided they satisfy the eligibility criteria set by the lender.
11. Personal Loan have Pre-Payment Option
With leading financial institutions, you can prepay your personal loan with ease and get rid of your debt quickly. While availing a personal loan, make sure that you check the pre-payment charges levied by the financial institution. A Bajaj Finance Personal Loan has low prepayment charges, attractive interest rate and no hidden charges. Moreover, you can apply for a Bajaj Finance Personal loan easily from the comfort of your home through a hassle-free online application process.
In this way, if you can break the vicious cycle of poor credit through proper planning, while at the same time making the process of getting a loan easier than you ever imagined.
You Can Get a Personal Loan Even with an Unsatisfactory Credit Rating
It is not difficult to get a personal loan with a bad credit rating or score. Financial institutions do allow any leeway for individuals in terms of repayment period and the amount that you will have to pay easily. There’s no need to shy away from applying for a personal loan just because you feel your credit score is low. You will find a plan that fits your needs perfectly with just the right amount of research. Be positive, put your best foot forward and apply for a personal loan today.
With Finserv MARKETS, your loan application can be approved within just 3 minutes and the amount can be credited to your bank account within 24 hours! So why wait? Head over to Finserv MARKETS and apply for a personal loan online with us, today!
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