You can still get a home loan even when you have a low credit score. Or even if you have no credit history (this is when your score is noted as NH/NA because you have not had any prior loans/credit cards).
Generally, you should try to improve your credit score before applying for a home loan. But, if this is not possible, you can try one of the following:
- Look for another lender: Find another lender who might offer you a home loan at higher interest rates.
- Get a Co-applicant/Guarantor: Apply for a loan with a co-applicant or a guarantor, like a close family member, who has a good credit score. This can improve your eligibility.
- Offer collateral: Some lenders might offer you a loan against some sort of collateral, such as gold, shares, assets, fixed deposits, etc.
- Prove stable income and bank balance: Having a stable income and a good bank balance can assure lenders that you can support the payment of monthly loan instalments.
- Opt for a reduced loan amount: You can request a lower home loan amount, and a higher down payment that poses a lesser risk to the lender.
However, remember that loan approvals usually depend on many other factors, and these methods might not ensure approval if your credit score is low.
If your application for a loan has been rejected, try to improve your credit score before applying for a loan again. Immediately applying for loans with another lender will reduce your score further.