A credit score is of great importance for taking a loan. If the credit score is good, the chances of getting a loan increase. It is also possible to increase the loan amount. Banks or non-banking finance companies check the person's credit score before giving the loan, they see whether the person who has applied for the loan can be given a loan. Is his credit history correct, is his repayment right? The person has not made any lapse in paying the loan. The bottom line of all these things is from the credit score. Sometimes in credit scores and Cibil scores, people become confused that both of them have different meanings, but it is not that both of them mean the same. Let us say that this number of 3 points from 300 to 900 means a lot for the loan. Most of the loan-paying companies demand a credit score of 750 or more.
Loan options when credit score is low
Joint Loan: You can apply as a co-applicant with another partner or relative for a joint loan that two people can take together. However, the credit score of both the applicants is checked. If the credit score of either one of them is low, the credit score of the other applicant is also getting a loan.
Gold Loan: It can be availed by mortgaging gold jewelry. The loan amount depends on the price of the mortgaged gold. The loan amount is decided after checking the purity of gold and the price information in the gold market. This loan does not require a good credit score. In addition, you also have the option to borrow from friends.
Loan on investment or property plan: These loans are taken on guarantee of fixed deposits, shares, PPF, properties, etc. The loan on it depends on the price of that property or investment plan. It does not require a credit score.
Image credit: bajajfinser