Salaried Professionals Can Qualify for Personal Loans Even With a Low Credit Score

loan for salaried employees

Personal loans come under the category of unsecured loans that come in handy during a medical or financial emergency, while planning for a trip, or to repay outstanding debts. Salaried professionals often get an upper edge for loan approval due to their income stability. Before issuing an unsecured loan, the financial institution would want to ensure that the applicant can repay the loan on time. 

Salaried professionals in metro cities like Bangalore with regular income get a better chance to qualify for a Personal Loan even with a low credit score. Here, we will walk around a few ways to get personal loans for salaried professionals in Bangalore despite low credit scores.

Factors Affecting a Salaried Professional’s Eligibility

Although salaried professionals have a better chance of getting quicker approval, lending institutions look at several factors before sanctioning the loan:

  • Employment: While evaluating an applicant’s eligibility, the employer’s reputation is crucial to determine job and income stability.
  • Outstanding Debts: Lending institutions check the applicant’s outstanding debts to anticipate timely payments. 
  • Monthly Salary: The applicant’s salary influences the NBFCs’ loan decision.
  • Credit Score: Ranging from 300 to 900, most NBFCs consider a credit score of 700 or above to get Personal Loan approval. However, online lending institutions like Clix Capital can offer an instant Personal Loan on a credit score of as low as 630.

Ways to Get a Personal Loan with a Low Credit Score

While many believe getting a loan for salaried employees with a low credit score is impossible, it is only partially true. Here are a few measures that one can implement to make it possible:

  • Prove a Decent Income to Support Timely EMI Payments

Despite a low credit score, applicants with decent monthly salaries may get Personal Loan approval. Providing proof of monthly salary to the lending institution as per their eligibility criteria can help the professionals get a Personal Loan instantly. However, the NBFC may charge a higher interest rate for such loan applications.

  • Maintain Job Stability with a Reputed Employer

NBFCs approve loan applications of professionals with a stable employment history. Usually, professionals employed with reputable private and public sector organisations, MNCs and corporate have higher chances of job stability than others. It is recommended to avoid changing jobs frequently and stay employed with the same company for a few months before applying for a loan.

  • Apply for a Lower Loan Amount

Applying for a big loan with a low credit score will indicate more risk to the lending institution. From the NBFC’s perspective, it predicts higher chances of missed EMIs and loan defaults. So those with a low credit score must apply for a smaller loan. It makes the lending institution confident while granting the application, as a smaller loan would be easier to repay. 

  • Apply With a Co-Applicant

If the credit score is low, getting a personal loan in Bangalore becomes easier by including a co-applicant with a decent income and credit score. As they complete the KYC formalities, the lending institution is likely to grant the loan approval. 

  • Correct Mistakes in the Credit Report

The credit report might contain errors that may hold the score down. Check the credit report regularly and request corrections if needed. If the report does not have the latest information, it might work against the record and reduce the credit score due to no fault of the loan seeker. Up-to-date and error-free information in the credit report will boost the credit score and project better loan eligibility.

  • Limit Loan Applications

Financial institutions check applicants’ credit histories before approving loans for salaried professionals. If they apply for several loans within a short duration, it gives a negative impression and projects the applicant as credit hungry. So, diligently research and study loan products and apply for a loan matching your eligibility.

  • Request a NA or NH in the Credit Report

NA or NB means no credit activity over the last 36 months. It allows the applicant to negotiate with the lending institution for interest rates. In such a situation, the interest rate might be slightly higher than others, as the applicant’s credit report will have no credit score. 

These steps can help a salaried professional in Bangalore obtain a personal loan despite a low credit score. However, ensure having sufficient funds for loan repayment. Regular payments will improve your credit score and increase your eligibility for future loans with better terms.

About the Author
Amaira sharma is finance expert and former business growth strategist who has more than 8+ years experience in the industry, now she helps others to get better financial stability and standards. She loves to write useful tips on personal finance and businesses.

Master James

Master James, a versatile wordsmith, possesses an unparalleled ability to delve into the depths of the General Niche, exploring a myriad of topics with finesse. His literary prowess extends across the vast tapestry of the USA, crafting engaging narratives that captivate readers from coast to coast. With a keen eye for detail and a passion for knowledge, Master James weaves together insightful perspectives on a broad spectrum of subjects, creating a literary landscape that mirrors the rich diversity of the American experience.

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