One of the easiest financing options to avail during urgency is a personal loan. The escalated demand for personal loans can be attributed to the fast approval for high-value loan amounts at affordable interest rates, helping borrowers sail through any financial emergency easily.
Though credit score is a significant determiner for loan approval, there are times when borrowers can avail of an urgent loan with bad credit in India. However, to do so, borrowers need to consider certain parameters.
Know how to avail of an urgent loan with a bad credit score in India
Borrowers can avail an urgent loan like a personal loan by implementing the following measures:
- Show stable income status
One of the effective ways borrowers can receive approval for a personal loan with a lower credit score is by showing evidence of adequate disposable income. Lenders will favour borrowers’ loan applications despite low credit ratings if they find borrowers with a high and steady income status. Moreover, a hike in salary or extra income source boosts the likelihood of lenders approving the loan application.
- Opt for a lower personal loan amount
Borrowers who want to avail of personal loan despite subpar CIBIL scores must opt for a lower loan principal. As the borrower already has a lower credit score, asking for a higher loan principal will make him/her high-credit risk individuals. Moreover, it acts as an indicator that borrowers will default on the loan amount.
Opting for a lower loan amount will help borrowers receive quick loan approval and repay the loan amount quickly, which will, in turn, help them boost their CIBIL scores.
- Go for a joint loan
Individuals with substandard CIBIL scores can boost their chance of getting approval personal loan amount by involving a guarantor or co-applicant. As the repayment responsibility gets divided between both the applicants, it will minimise the lender’s credit risk. Moreover, if the co-applicant has a healthy CIBIL score and a stable income source, it will position them advantageously in receiving rapid loan approval. With the help of a co-applicant with a decent credit score and steady income status, one can avail of a personal loan without CIBIL score.
However, borrowers must abide by the eligibility norms and complete the necessary documentation.
- Fix the errors in credit report
There can be a possibility of misreporting or errors in the borrower’s credit report, and it happens when any recent transactions are not updated. Hence, it is imperative for borrowers to evaluate their credit reports regularly; otherwise it might take a toll on borrowers’ credit scores, making it difficult for them to avail a personal loan.
Though borrowers can avail of personal loans with subpar CIBIL scores, they must never negate the importance of a CIBIL score in borrowing. In this context, borrowers must know how CIBIL score is important for personal lending.
The CIBIL score shows borrower’s financial behaviour, creditworthiness and repayment history. Hence, if CIBIL score is getting borrower’s down, they must consider the following factors to enhance it.
Know how to improve CIBIL score
Borrowers can follow the mentioned ways to improve their CIBIL score:
- Repay dues on time
Borrowers must set reminders for making loan repayment on time. Paying outstanding loan amounts or credit bills timely helps enhance credit score. Missing out on EMI payments will affect borrowers’ CIBIL score, and they also have to bear Bajaj Finserv EMI overdue charges.
- Avoid availing too many loans
Borrowers must limit availing several loan options in a fixed period. Repaying one loan amount and then opting for another keeps borrowers away from debts and increases their CIBIL score.
- Choose a longer loan tenor
Settling for an extended loan tenor will help borrowers repay loan amounts on time, helping them dodge defaulting on EMI payments and boost their CIBIL score. In this context, borrowers must find the right personal loan tenor that works for them.
Maintaining a decent CIBIL score will help borrowers reap all the features and benefits of Bajaj Finserv Personal loan.
Keeping these factors in mind will also help borrowers reap the exclusive pre-approved offers extended by leading financial institutions. These offers are available on a wide range of financial products like personal loans, business loans, credit cards, etc., and help expedite the loan application process. Intending borrowers can check their pre-approved offers by submitting their names and contact details.
To sum up, a personal loan or urgent loan is an unsecured loan that helps borrowers in terms of multiple usages, rapid disbursal, easy-to-meet eligibility criteria, etc. Moreover, with the easy accessibility of this credit option, borrowers can avail of an urgent loan with bad credit in India.