A personal loan is something that could be necessary for a person at any point in time for an emergency. It is best to use a personal loan EMI calculator in order to calculate and plan according to one’s requirements and urgency. A personal loan EMI calculator comes handy not just in case of immediate requirement but also to generally check the capacity for a personal loan to fulfil long-term goals and dreams. However, first time personal loans can be difficult to access if one has no credit history. Lenders would always want to ensure that a potential borrower has been responsible with repayments in the past. Therefore, it often becomes difficult to get first time personal loans with no credit history.
However, there are certain things that can help borrowers to deal with such a situation:
- Apply for a personal loan with low amount
A personal loan involves high risks due to its large amounts of money. What then becomes important is a good credit history. However, reducing the amount helps to lower the risks involved for the lender. A lender would most likely be more confident in sanctioning a personal loan with no credit history if the amount is reduced.
- Collateral Based Personal Loan
A personal loan that has collateral erases the requirements of presenting any credit history. In such a case, any asset ranging from vehicles and TVs to gold and real estate could come into play as collaterals. This makes it easier for the lender to sanction first time personal loans as the collaterals work as a guarantee that the borrower would repay the money. Any collateral based personal loan would also have a low rate of interest.
- Produce documentation of your income
The income of the borrower plays an important role in case of sanctioning a personal loan. It becomes easier for the lender to trust a consumer who is able to produce documentation for their income. Leveraging one’s income is in itself a proof of their creditworthiness and also helps personal loan eligibility.
- A cosigner
A cosigner is somebody whose income would be presented by a different person to obtain a personal loan. It is another method of getting first time personal loans with no credit history, with the help of a cosigner who would agree on repaying the amount if one fails to do so.
- NA or NH credit history
If one’s credit history is marked with NA or NH, there is an indication of zero activity in the previous 36 months. Getting a personal loan with no credit history along with a NA or NH would also boost one’s credit history once the repayment has been made, which further helps in personal loan eligibility.
There are a number of options available for consumers with no credit history.