If you’re thinking about applying for a Loan Against Property (LAP) but have a low CIBIL score, you might feel uncertain or even discouraged. Traditional banks often reject loan applications just based on this number. But at Shubham Housing Finance, we believe your past doesn’t have to define your future. If you have a property, we can help you unlock its value — even if your credit score isn’t perfect.

This article will explain how LAP works for borrowers with low credit scores, and how you can still get approved without jumping through impossible hoops.

What Is a CIBIL Score, and Why Is It Important?

Your CIBIL score is a three-digit number ranging from 300 to 900. It’s based on your credit history — how you’ve managed loans, credit cards, and repayments in the past. A score above 750 is considered ideal by most traditional lenders.

But what happens if your score is below 650 or 600? Banks usually flag you as “high risk,” making it difficult to get unsecured loans or home loans. However, a Loan Against Property is a secured loan — which means the rules are different, and there’s more flexibility.

What Is a Loan Against Property (LAP)?

A Loan Against Property lets you use your existing residential, commercial, or even plot property as collateral to get funds for various needs — business expansion, education, marriage, medical treatment, or even debt consolidation.

Because the loan is backed by an asset (your property), lenders are more open to considering your overall financial position — even if your credit score is low.

Why Your Credit Score May Be Low

There are many reasons someone might have a low CIBIL score:

• Missed EMIs or delayed credit card payments in the past

• High credit card usage or multiple loans

• No credit history at all (common among young or self-employed individuals)

• Financial stress from a job loss, medical emergency, or personal issues

Whatever the reason, a low score doesn’t mean you’re financially irresponsible — it just means you’ve had a rough patch. At Shubham, we understand that.

How to Get a LAP with a Low CIBIL Score

Here are the practical steps to increase your chances of loan approval, even with a low score:

1. Provide Alternative Income Proof

Traditional lenders focus only on payslips and IT returns. But at Shubham, we evaluate actual income, even if it comes in cash or through informal channels.

You can show:

• Bank statements showing regular deposits or business income

• Utility bill payments, rent receipts, or mobile bills

• Sales receipts, customer invoices, or ledger books (for shop owners or freelancers)

• Co-applicant income if you’re applying with a family member

This helps us understand your repayment ability beyond the credit score.

2. Use a Legally Clear Property

Since LAP is a secured loan, your property is a key factor. Make sure:

• The property is in your name or jointly owned with full consent

• All property documents are in order

• There are no legal disputes or encumbrances

Our team will also conduct a property valuation to determine the loan amount you can get — typically 50% to 70% of the property’s current market value.

3. Add a Co-Applicant (Optional but Helpful)

A co-applicant with a better credit profile or higher income can boost your chances. This could be your spouse, parent, or sibling. Their income adds to your eligibility and can help in case your score is very low.

4. Offer a Higher Margin or Lower Loan Amount

If possible, apply for a smaller loan amount or be open to a higher margin (lower loan-to-value ratio). This reduces the lender’s risk and increases your chance of getting approved.

For example, if your property is worth ₹50 lakhs, instead of applying for ₹35 lakhs, applying for ₹25 lakhs may improve your approval odds — especially with a low score.

Must Read: How First-Time Homebuyers Can Get Loans Without Credit History

Why Choose Shubham Housing Finance?

At Shubham, we’ve built our loan process around real people — not just credit reports. Our unique model focuses on understanding your cash flow, your goals, and your repayment capacity. We specialize in working with:

• Self-employed individuals

• Informal income earners

• First-time borrowers

• People with low or no CIBIL scores

What sets us apart is our human approach — we assign a relationship manager who sits down with you to understand your situation, rather than just relying on data.

Real-Life Example

Take Mr. Verma, a small kirana shop owner in Meerut. He had a CIBIL score of 580 due to missed credit card payments five years ago. But his shop was running well, with steady cash income. He owned a house worth ₹40 lakhs. With Shubham’s help, he got a loan of ₹20 lakhs to renovate his shop and clear older debts — even though a bank had rejected him.

Final Thoughts

A low CIBIL score doesn’t have to stop your financial progress — especially if you own a property. At Shubham Housing Finance, we’re here to help you make the most of what you already have, and support you with flexible solutions that fit your life.

So, if you’ve been turned down by banks due to a low credit score, don’t lose hope. Your property could be the key to achieving your goals — whether it’s growing your business, funding your child’s education, or just getting back on track.