Today, in order to avail any loan whether it is secured or unsecured, you need a good credit score. Maintaining a good credit history is important for everyone. This helps in getting a good interest rate and possible waivers on many fees and penalties from the lender. This also applies in case of a home loan.
Taking a home loan in India is a long term relationship for the borrower with the lender. If the person has a bad credit score, he/she might either not get a loan or might have to accept the loan at a higher rate of interest. This means there is a possibility of rejection to get a loan or paying higher EMI’s. In order to ensure this doesn’t happen, allow me to explain using 4 simple steps on how you can come out of this situation and get your home loan approved quickly;
Check your credit score – You need to understand your current credit score. Hence apply for a credit report and know your score. This helps you to understand your current condition and help you in planning to improve your score for future benefits.
Improve your credit score – After you make a plan, be disciplined and follow it. This will ensure that the credit score is improving within the planned tenure. You can opt for a credit card and a personal loan for help. Pay the bills and EMI’s on time without any default. Over a period of 6-12 months, this will help you increase your credit score.
Check for different lenders – There are many lenders in the market apart from the Banks like NBFC’s that provide you loans with average or bad credit scores. You need to understand that the rate of interest would be higher than other lenders but there is a possibility of getting a loan.
Correct documentation – Once you finalize on a lender and agree with all the terms and conditions mentioned in the loan application, keep all the necessary documents like income, personal details, property documents etc ready to ensure the loan process goes through in a smooth way.
The importance of maintaining a good financial profile is needed for every person. This can help you save money and get a loan approved quickly at a lower rate. Please ensure you read the terms and conditions in the loan agreement. Only after understanding them, sign it.