If you are a healthcare professional looking to buy, lease, or upgrade your practice's medical equipment, you might need a medical equipment loan. It is a type of business loan that lets you finance your equipment purchase and pay it off over time.
However, before you apply for a medical equipment loan, you should be aware of how your credit score impacts your loan approval. Your credit score is a numerical representation of your creditworthiness, based on your past and present credit behaviour. It reflects how well you have managed your debts, such as loans, credit cards, bills, etc.
Your credit score affects your medical equipment loan approval in several ways:
It determines your eligibility: Different lenders have different eligibility criteria for medical equipment loans. Some lenders may require you to have a minimum credit score of 600 or above, while others may accept lower scores or even no credit history. For the Bajaj Finserv Medical Equipment Loan, you need a credit score of 720 or higher.
It influences your interest rate: Your credit score also influences the interest rate that the lender will charge you for the loan. Generally, the higher your credit score, the lower the interest rate you will get. Conversely, the lower your credit score, the higher the interest rate you will pay. A higher interest rate means a higher cost of borrowing and a higher monthly payment.
It affects your loan amount and tenure: Your credit score also affects the amount and tenure of the loan that you get. Typically, the higher your credit score, the higher the loan amount and the longer the loan tenure you get. This means you can borrow more money and repay it over a longer period. However, this also means you will pay more interest over the life of the loan.
Therefore, it is important to maintain a good credit score if you want to get approved for a medical equipment loan with favourable terms and conditions. You can improve your credit score by paying your bills on time, keeping your credit utilisation low, avoiding multiple inquiries, and checking your credit report regularly for errors.
