Your CIBIL score is one of the most important eligibility considerations when applying for a house loan. If your CIBIL score is good, you can take advantage of several interesting perks and services. As a result, most people with a low Free CIBIL score have trouble getting credit. It’s a common fallacy that you can’t acquire a home loan if you have a low credit score. Some people are even scared that if their CIBIL score goes below 650, they would be denied a home loan. In this circumstance, lenders usually charge a hefty interest rate. You can only qualify for a home loan if your credit score is above 700 out of 900.
In India, many people do not have a good CIBIL score. The rejection of their lender is a major problem. To address this issue, banks and other financial institutions have developed a variety of house loan options that allow people with poor credit to obtain financing.
Apply for a Home Loan with Low CIBIL Score
If you have a low CIBIL score, you can still apply for a home loan by negotiating with your bank or financial institution in the event of a loan or credit card payment default. When you reach an agreement, you can pay the settlement sum and receive a NOC (No objection certificate). The NOC makes the process of applying for a home loan much easier. However, you must review your CIBIL score before applying for the loan to confirm that there are no discrepancies or inaccuracies, and that your credit score, including settlement data, is accurately stated.
Another option for a negative credit house loan is to go to a bank with which you already have a relationship. A bank, for example, with whom you have successfully repaid a loan. It might also be a bank where you have a payroll account or a savings account where you deposit and withdraw money on a regular basis. Even if your CIBIL score is low, your customer loyalty may be able to help you get a home loan. Even if your CIBIL Score is low, you can acquire a loan from a bank or non-bank financial institution if you have a large account balance and a series of recurrent or fixed deposits.
If your CIBIL score is low but your spouse’s is high, you could enlist his or her help in obtaining a home loan. You can speed up the approval process for your home loan by including your spouse as a co-applicant or joint account holder on the application.
In case your CIBIL score is Zero
Although hardly everyone in India uses credit, many people want to take out their first loan. Applicants who are ‘New to Credit’ or ‘First Time Home Buyers’ are categorised as such. Customers with no credit history can nonetheless apply for a mortgage because there is always a start. In this instance, the lender becomes extra cautious and conducts additional checks before authorising a mortgage. People with no credit history or a low CIBIL Score might employ a guarantor with a high CIBIL Score to improve their chances of getting a loan approved.
While getting a home loan with a low CIBIL score isn’t impossible, there are a few things to keep in mind. It’s crucial to understand that a low CIBIL score can result in a higher interest rate on a home loan. If you miss an EMI payment, your credit score will suffer, making it more difficult for you to obtain a loan in the future. You must make sure that your EMIs are paid on time.
Read Also:- What Are The Current Home Loan Interest Rates?