This is just a brief overview of what a 590 credit score means. it is important to understand that what can you get with 590 credit score before applying for any loan or Credit Card.
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AECB Credit Score is linked to a unique mobile number
Before lending a car loan, banks analyse the applicant’s eligibility in terms of age, salary, valid documents, AECB credit score, and others. While not paramount, credit score for car loan is a crucial factor that impacts the applicant’s eligibility for a car loan.
The credit score is a three-digit number calculated by the Al Etihad Credit Bureau (AECB). The AECB Credit Score in UAE reflects a customer's past behavior in repaying loans, the due amount on credit cards, credit and loan applications (whether rejected or approved), and so on.
With higher credit scores, there are higher chances for a candidate to qualify for a car loan. While the exact credit score for car loan needed for a car loan may depend on the applicant’s other factors and the bank, a good AECB credit score that is 700 or higher is generally considered acceptable by banks. Such a high score indicates low risk regarding the customer's credit history, thus, reflecting reduced risks for the bank. To enhance credit score and credit reports, a candidate must follow practices like timely payments, prevention of bounced checks, eliminating unneeded debt, paying credit card balances, and so on.
|How to Improve Credit Score in UAE|
The credit report provided by the AECB contains all of an applicant's financial information including prior and ongoing loans, number of credit cards, monthly income, credit score, and so on. Banks usually obtain these reports from the AECB when an individual applies for a financial product or service of the bank.
In the UAE, different banks have different requirements for providing a vehicle loan in the UAE. The most common documents to be presented to apply for a car loan in the UAE are as follows:
When applying for a car loan in the UAE, ex-pats should ensure that their home country's driving license is valid in the UAE. In case their driving license is expired or invalid in the UAE, ex-pats must apply for a UAE driving license to qualify for auto finance.
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Given below are the major eligibility criteria for most banks and car loan providers in the UAE.
To apply for a loan in the UAE, a borrower must be at least 21 years old. A similar restriction is on the upper side, with the maximum specified age being 60-65 years. The upper limit is negotiable as per the financial conditions of the applicant and should be verified with the bank first.
The minimum salary requirement for car loans in the UAE varies among banks. However, most banks require a minimum salary of AED 5,000 on the applicant’s part.
Most banks finance up to 80% of the vehicle's worth. However, you must make a 20% down payment as an applicant in advance. In certain circumstances, the bank may accept the down payment, while others would require the down payment to be transferred directly to the automobile owner. This is another key factor that must be considered while buying a car loan in the UAE to avoid an unexpected financial burden.
While most of the leading banks in the UAE don’t have a specific limit for credit score for car loan, they require at least a fair credit score that demonstrates the applicant’s satisfactory history in managing credits and loans.
As specified earlier, credit score, calculated by the AECB, is utilised by banks when deciding on an application regarding their services like car loans. This AECB credit score is based on a range of factors like
It should be noted that credit ratings are progressive, meaning that they can alter over time with a change in financial behavior and actions. Generally, late or missed payments, excessive usage of your credit card limit, multiple loans at a time, and others can all damage your credit score. Consequently, if you have a low AECB credit score, lenders and financial institutions are unlikely to issue you a loan.
You can easily improve your credit score for car loan in the UAE by being punctual regarding the repayment of credit dues and loan instalments.
By following the points mentioned below, you can ensure that you get the best car loan in the UAE for your requirements.
Apart from having ready funds to purchase your ideal automobile, applying for an auto loan provides the following perks.
A car loan is an excellent option if you want to get a car in the UAE without burdening yourself with the high vehicle costs. With several options available, you can easily find a car loan in UAE that will fulfil your requirements at affordable costs. If you are above the age of 21, fulfil the bank’s specified criteria such as minimum monthly salary, and have a good credit score for car loan, you will be able to apply for a car loan in the UAE.
Whether you apply for a car loan in the UAE online or offline, the key aspect to remember is to fill up the application correctly and have all the required documents ready for a smooth experience. Another aspect to take care of before applying for a car loan is the credit score. If you fail to have an adequate credit score for car loan, your loan application might be rejected or you may be provided higher interest rates.
Having a good AECB credit score is easy if the efforts are made consistently. You can strive to complete all repayments on time and avail of credit cards or loans within your financial capabilities to improve your credit score. Similarly, you should avoid applying for multiple credit cards and loans or repeatedly enquiring about your credit score. Following the above steps is enough to have credit score for car loan that brings you your desired loan option.
Before leaving, you can check more facts regarding car loans in the UAE below.
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Guide for Credit Score in UAE
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