- September 2, 2021
- Posted by: Nikhil Sharma
- Category: Loans
Everybody applies for a loan at least once in their lifetime. But this is not a guarantee that your application for a loan can get sanctioned. Many loan applications get rejected simply because of low credit scores. Loans without credit score check in UAE is not so simple. This is well known that the UAE banks examine the credit history of the applicant and are very specific about the credit score of the applicant. They accept the loan application in case the credit score in a good manner means the score has to be above 580 to be sanctioned. Here we discuss a few things regarding getting a loan without checking the credit score of the applicant.
Usually, you don’t need collateral like a home or a car to obtain personal finance, as this is typically unsecured. This kind of loan is structured as an EMI loan. It means you would have to repay the amount borrowed with the personal loan rates of interest. This payment is paid within the loan period as stipulated by the bank, with an agreed number of installments in a monthly manner.
Although, if unfortunately, you do not have a good credit score, you can only have limited options for personal loans as banks and financial entities demand a minimum credit score for approving a loan in the UAE and you have to hold higher interest rates as well. Therefore, even if you are eligible for a loan, this can be costly for you to repay.
Why do banks Check Credit History?
Banks examine your Al Etihad Credit Bureau credit report prior to approving your loan. The credit report given by the AECB contains all the financial details ranging from the applicant’s past and existing loans, the number of credit cards, credit score, and monthly income. They determine the individual’s ability to repay the loan and installments in a timely manner without any burden, through the debt to burden ratio, by taking into your account your outgoing and incoming cash flow.
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The Process to Get Loans Without Credit Score check in UAE
This is not easy for an individual with a low credit score to obtain a loan from a bank. There are banks that give loans without pay transfer, personal loans for unlisted companies, but there are no such banks in the UAE that avoid low credit scores and give an unsecured loan.
Apart from a personal loan in the UAE, there are certain choices you can consider to obtain a loan.
1. Peer to Peer Lending
The first thing that comes to mind, when you require extra cash is asking a friend. It really works but not all the time and not sure when you require a large amount of credit. Well in such situations, a private lender comes into the picture. There are some officially permitted private lenders who give loans to borrowers with a low credit score. Typically, private lenders do not offer any credit check loans. They only go through certain documents to prove their identity. Although even you require immediate cash, the private lenders collect very high rates of interest which can be twice the rates of the bank and this is the reason why private lenders are not a good choice.
2. Secured Loan
Banks take special care of credit score while giving an unsecured loan, but in the situation of a secured loan they may consider the application of a loan without a check credit score in the UAE but at high return rates which can differ with every bank. You can mortgage your assets such as gold, car, and more., as collateral and obtain a loan against them.
3. Lending Using Credit Card
If you have a credit card, this can equal an asset. You can receive loans against your credit cards or avail of a cash advance option in the UAE. But getting a loan on your credit card is that much better because this is given at very rates of interest which can be a big burden.
4. Salary Advance
It is a better choice for salaried persons. Job seekers can receive a loan on their monthly income. There are different famous banks in the UAE that offers loans on your salary at competitive rates of interest.
Apart from these, there are different other possibilities to obtain a loan in the UAE, that you can consider and fulfill your short-term goals.
Read More – How to Improve Credit Score with the Loan