How to Get a Personal Loan Approved with Low Credit and Low Income?

Move on from your worries. Get your quotes received from one or more of the lenders. Kill questions like will there be a bank/NBFC that will come to my help? The good thing about today’s market scenario is that certain banks and financial institutions are still willing to lend you a personal loan, albeit with conditions attached. Compare and choose the best lenders on Afinoz. And, meanwhile, we would want you to comprehend how you will get your personal loan approved easily.

What is a low or poor credit?

In simple terms, the credit score is a measure of the financial health of an individual and it also illustrates how good he has been in repaying his credits. Based on it, the lender determines whether he is eligible for personal loans.

Different banks have different benchmarks to decide on the credibility of the applicants and usually offer different interest rates depending upon their credit scores. It can be challenging to get thepersonal loanapproved, if you have a bad credit or low credit. On the other hand, with a good credit score, you will stand a great chance of getting your personal loan approved.

The impact of low credit score on Personal Loan Interest Rate

When you do a personal loan apply, the lender ascertains the likelihood of yourloan repayment from your credit score. Banks and financial institutions normally adhere to a pre-decided range for the same. The bad credit score normally starts from 630 and below.

Go for ICICi bank Personal Loan and fulfill your aspirations.

Thanks to modern financial methodologies, many banking and financial institutionsnowadays render personal loans to individuals with low credit too. However, there is a probability that the bank’spersonal loan interest rate will be on the higher side. Also, at times, people with a low credit may be offered unfavorable or stringent terms and conditions as compared to those with excellent credit scores.

How to avail a personal loan with low credit? Improve your credit score

This is the first major step and will help you more if you are not in an emergent need. Three actions together can positively impact about 75% of your credit score. They are — on-time payment, low credit utilization, and staying away from new credit applications.

Start making ‘on-time’ payments for your existing EMIs or credit cards and reduce your card balance to below 30% of the allowed credit limit. Taking such proactive steps can raise your credit score at least by a good 100 points within a time-frame of 3 to 6 months.

Plan an interview with the loan executive of a lender

If you are in dire need of an ICICI bank personal loan, you can ask for a face-to-face interview with a concerned executive so that you can convince him about your creditworthiness.

Go fully prepared with all documents that can support case and can convey a better account of your financial stability. Some of such documents that can enhance your creditworthiness are -

  • IT returns for the at least the last 2 years
  • Job history details with salary break-ups
  • List of your existing assets (home, property, car etc)

If you do not have a good credit score to show up, the above-mentioned documents can help a great dealto show that you have become more sensible and precise in handling your money. This can help you immensely to get your loan.

A word of caution for you!

you may come across many lenders that specialize in bad credit loans. But, do keep in mind is that some of these lenders do not belong to the group of reputed credit unions. Therefore, it is highly imperative that you should exercise utmost caution while choosing a lender, if you have a low credit score. You should opt for a lender with transparent fees/rates and also someone who is willing to adjust with your previous credit issues. But, if you happen to come across a lender more than willing to provide an ICICI bank personal loan to you, it’s better to sense danger and play your cards wisely!

There exists another group of lenders who are constantly on the lookout for people in need of a loan and have a poor credit. They use unfair means like scams to entice such people into paying exorbitantly high interest rates and, in turn, trap them into a vicious cycle of debt.

How to get a personal loan with your low income?

As income is a major criterion of getting a personal loan, we have received inquiries from many low-salaried professionals regarding whether their low salary will be a deterrent when they do a personal loan apply.

All such low salaried professionals can have a big sigh of relief!

Yes, you can avail a personal loan such as an ICICI bank personal loan,even with your low income. Here, we will tell you about some of such options at your disposal-

You can do a personal loan apply against your FD account with any bank. Even if you have a low income, some of the lenders will not hesitate to grant you personal loans as they will have the security of your FD at their disposal. In this case, they are more likely to be a bit lenient on their minimum income criteria but only about 80%-85% of your FD amount will be approved as your personal loan amount.

If you are currently availing a gold loan by pledging your gold bars /ornaments then you can always do a personal loan apply against your gold loan. As a usual practice, about 75–80% of the gold’s value you pledged can be granted as the personal loan amount. In this case also, your low income is not at all a deciding criterion for the lender to approve the personal loan for you.

NBFCs usually have less stringent conditions for lending and often dispense with the minimum income criterion in some particular cases. If you happen to be their existing customers, you can expect a preferential treatment when you do a personal loan apply with them. These loans usually encourage group lending based on joint liability in order to improve payment obligations.

Personal loan schemes from microfinance companies are designed to address the needs of those employed in the lower strata of the society. People from weaker sections of society, housewives and people engaged in small-scale businesses can also do a personal loan apply with such companies.

Originally published at on June 14, 2019.