Getting a home loan, if you have a low credit score is not an easy task. The better credit easier it will be to qualify for it. Based on your credit situation, it may not be possible. You
may have to pay more than borrowers who have a sparkling credit, and
you may not even qualify for low interest rates in the current market. But you may be able to qualify for a home loan despite your low credit score, if you have a steady income. Here are some ways you may be able to get it even with a low credit score.
The first thing to do is to check your credit score and try to increase it in advance. Credit
Information Bureau (India) Limited (CIBIL) collect your credit
information, establish a credit history report and give you a credit
score ranges from 300 to 850 points. There
is a rating system used by those who put your credit score in
categories from A to D, where A is excellent and D being poor. You can get a free report from them and find out how bad your credit is. Find any errors or inconsistencies that may be present in your credit report and correct them immediately. Be sure credit report, you give the lender is correct and accurate.
The
yield on low credit score home loan can vary from very high interest to
a rate somewhat higher than for customers with good credit. So if you know your credit score, you will know exactly how it will affect your interest and the opportunity to get a home loan.
Once you know how you fair in your credit ranking take steps to improve your credit rating. There are several ways you can increase your credit score. The fastest way to improve your score is to pay down your balances. Always make it a habit to make timely payments as payment history includes the maximum credit score. Scan through your credit reports for any mistakes and shortcomings and correct them immediately. Even
6-8 months of good credit behavior make a good impact on your credit
score and bring them up enough to qualify for a bad credit home loans.
Try to collect as much money as you can to make a payment. A large down payment will secure more favorable terms on your home loan despite a bad / low credit ratings. The bigger your payout on the loan, the lower the risk you present a lender.
Try and ensure your home loan, ie, the bank offers some protection in exchange for it. This means that if you default the lender can seize the collateral you provide. It keeps you in good faith with the lender and increases your chances entitled to it.
Another very effective option, and in some cases the ideal solution would be to find a co-signer. A co-signer can be a relative like a parent or spouse who would sign home loan with you and assume responsibility for it. A co-signer with to guarantee the loan by signing the loan documents with you. The co-signer or co-borrower will be responsible for repayment if you default. So
if you can manage to find a co-signer bank will use his / her credit,
income and asset information instead of yours for home loan
qualification procedure.
