How To Get Loan With Bad Credit Score In UAE

Dubai has grown in popularity as a destination for expats over the years. Many entrepreneurs want to start a company here and they required company loans for their startup. The Dubai loan industry has grown into a well-established market providing company loans to local and foreign lenders. If you want to get company loans in Dubai then, here we mentioned a few things that you have to consider. These all things will surely help you in obtaining a company loan.

The UAE’s banking sector is a booming one, with banks providing an array of financial products. With the UAE’s world-class lifestyle, the easy availability of loans can be tempting but it is vital to borrow wisely so that you can stay in control of your finances.

It is well known that the UAE banks check the credit history of the applicant and are very much particular about the applicant’s credit score. They approve a loan application only if the credit score is good that means the score must be above 580 to get approved. Higher the credit score, the higher the chances of loan approval.

Here Is All You Need to Know About Getting a Loan With Bad Credit Score in UAE

The UAE uses a credit score to examine the financial health of a loan applicant. The credit score is a three-digit score offered by the Etihad credit bureau. The higher the score, the higher the probability of obtaining a loan approved. You can get your credit report on the Etihad credit bureau’s website or app, and it will cost you Dh 140.

Another factor that can affect your loan eligibility is your debt burden ratio. Central bank regulations make it compulsory that one’s debt burden ratio should not exceed 50% of their total monthly income.

So, we can see that the very crucial factor for obtaining a loan approved in UAE is the credit score. Getting a bank loan in Dubai or UAE is not complicated if you have a good credit score. But if you have a bad credit score, you can have only some options to select from, and you have will potentially pay much higher interest rates.

Fortunately, there are several options available to obtain a loan in bad credit or a loan without credit checks in UAE.

  • Banks : The UAE banks have a very strict policy about bad credits, and typically they do not offer unprotected loans. There is a list of documents that necessary to apply for a personal bank loan. You should have a valid passport with a valid residence visa. the bank can require a salary transfer, if so, then a pay transfer letter will also be needed. You also have the latest three months bank statement with salary credits. Some banks can also ask for post-dated cheques for security reasons.
  • Private or Peer-to-Peer Lending : The core idea that comes first to your mind when in requirement of additional cash is asking a friend or family member, or colleague. The works sometimes but not always, especially when you require a big amount of cash. In this case, private lenders are another choice for you. there are various private lenders in UAE that offer loans to persons with bad credits, but typically, their rates of interest are much higher than banks.
  • Lending Using Credit Card : If you have a credit card, this can be the equivalent of an asset, you can get a loan against your credit cards or get cash advance options in the UAE. Many residents looking for credit cards without offering bank statements or minimum salary, but it is not advisable to take out a loan against your credit card if you are in this position, as it is offered at a very high rate of interest which can be a huge burden.
  • Secured Loans : Banks are particular about credit score while offering an unprotected loan, but in the case of a protected loan, they may consider the loan applications without credit check in the UAE but can be on high-profit rates which can differ with every bank. you can pledge your assets such as car, gold, etc., as collateral and obtain a loan against them.
  • Salary Advance : This is the better option for salaried individuals. Jobholders can obtain a loan against their monthly income. There are many popular banks in the UAE that provide loan against your salary on competitive rates of interest.

Other than these are different other options to get a loan in UAE, which you can consider and complete your short-term goals.

Also read, How To Get Company Loans In Dubai

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