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How to get home loan with bad credit?

How to Avail Home Loan With Bad Credit?

It is a difficult task to obtain home loan with bad credit score. But this problem can be solved by obtaining home loan from other entities such as from co-operative banks, friends or relatives. Even if you have a bad credit score, you can buy your dream house by switching off to other financing sources.

Bad credit can abstain from buying your dream house

It may happen that your credit history is not satisfactory to prove your creditworthiness to the lender. Banks are very particular in referring to the CIBIL score before approving home loan application. This hinders your dream of buying your 2BHK flat in the best locality. Right? The best suggestion is to improve your CIBIL score by making timely payments to credit cards and loans.

Are you a victim of intentional or willful default due to which you have a bad credit? Then, get it rectified soon. It is agreed that correction of CIBIL score takes a long time, but it will help you in getting a home loan.

There are other ways of availing home loan with bad credit.

Recommended Read : How to check your CIBIL score?

Co-operative banks come to your rescue

You must be well aware that co-operative banks offer higher interest on fixed deposits. Similarly, they charge comparatively higher interest rates on the loans granted. This is because the co-operative banks need to re-deploy their funds. They have a practice of granting home loans without referring the credit report. So, why wait? Rush to your nearest co-operative bank to confirm the same. You may also build references with the employees or manager of co-operative bank.

Family is family and a friend will always help in need

If you have healthy relationships with your family or friends, then you ask them for home loan. For securing your mutual transaction, you can enter into home loan agreement including all the loan details. You can also pay interest in lump-sum as mentioned in the agreement. Your good friend or your relative will never check your CIBIL score.

Check your assets

You can also avail loan on your assets. Now, you won’t get the entire amount from one source itself. So, you can create a pool of the home loan amount. For example, take gold loan on your jewelry, loan against your fixed deposits, or loan against insurance policy. Yes, you will need to keep a track of your principal amounts, interest rates and interest amounts. Pay it regularly considering as your home loan EMI. It will be a tedious task to manage this. But do remember, you do not have to show your bad credit to anyone.

Corporate tie-ups and private lenders

If you are having a salary account with a bank, then check with the manager if you can avail personal loan on the basis of your salary. It depends on the bank to grant loan. In some cities, you may also find private lenders who grant loans on the basis of references. They do not check your credit history but you have to bear interest at higher rates.

Thus, if explored properly, you can fulfill your dream of living in your owned house.