Finding a loan can be quite difficult for you if you have a poor credit rating or none at all. This is referred to as a bad credit score, and as a result, starting a new business or developing a new organization becomes quite challenging. Fortunately, there are other ways for you to get a bank loan. These choices include:
Gold loan
This is the simplest and most straightforward approach, but in order to use the gold, you must first have gold on hand for the lender. Being a secured source of credit, the lender typically does not consider your Loans for bad credit score. Additionally, it offers flexible repayment options along with speedy processing. Typically, you will receive a loan for 75% of the gold’s worth with an annual interest rate of 7%.
Loan against property
Another excellent alternative for people with bad credit score who are unable to obtain a loan from a bank but can do so from the option mentioned above is this one. You must have the property, house, or business under your name to qualify for this loan. The worth of the item, or the property registered in your name, will directly affect the loan’s amount. 7.5% annual interest is charged on this. Additionally, the loan terms might be up to 15 years and occasionally 20 years.
Loan against securities
You might choose this loan against securities if you have investments in mutual funds or shares. The securities will determine the loan amount and the interest rate. Additionally, you will need to already be associated with the lender, bank, or NBFC.
Top up loan
Only previous borrowers of house loans are eligible for this option. For those, they can get in touch with the lender, who would give them an additional home loan. The top-up loan can be used for any purpose, unlike the house loan, which is only for residential usage. The fact that this loan has the lowest interest rate among credit loans is another benefit. Another significant benefit is that borrowers with longer home loan terms might take longer to pay back their top-up loans.
If a person has a very bad credit score or none at all, there are a few ways they can still obtain a loan from a bank or lender. But keep in mind that a solid financial future requires a high credit score.
