Getting a home loan with a low Credit Score

A credit score is something that impacts your financial health, either positively or negatively. Before anything, the most important thing is to know your credit score. Generally, any financial institution will take the credit score into consideration before sanctioning any type of home loan. Customers with low credit score usually face issues in getting a home loan or any type of credit.

There is a certain range which decides whether your credit score is good, bad or average. Credit score range from 750-900 is excellent, 650-749 is good, 550-649 is average, and 300-549 is poor.

The customers who know their credit score have the possibility of improving it by making timely payments. In the case of those people who don’t know their credit score can negatively impact the chances of availing a home loan or any home loan.

The credit score is monitored by CIBIL (Credit Information Bureau (India) Limited). A credit score of 750 and more has higher chances of any home loan getting approved. On the other hand low score of up to 300 makes it difficult to avail home loans even at higher interest rates.

Customers with low credit score can visit HFCs (Housing Finance Companies) or NBFCs (Non-Banking Financial Companies) where there are chances of getting a home loan but with higher interest rates. If you have a decent salary then some lenders may consider it while approving a home loan request. The best option is to opt for a joint home loan with your spouse. Taking joint home loans allow the lenders to provide a high home loan amount at low-interest rates and the burden of the repayment is also shared.