Need a Personal Loan with 600 Plus CIBIL Score

Need a Personal Loan with 600 Plus CIBIL Score

Did you recently get a loan application rejected because your CIBIL score is too low? Now, are you confused because you are not even aware of what a CIBIL score is? Do not worry! You are not alone. There are a number of people who do not even know what the CIBIL score is. However, the fact of the matter is everyone needs to be aware of their CIBIL score in order to make the best use of credit facilities offered by various banks and non-banking financial services companies.

Understanding the concept of CIBIL Score:

CIBIL score is the score of your creditworthiness that is generated and maintained by the Credit Information Bureau of India Limited. Every loan or Credit Card you take is reported to CIBIL, and based upon how prompt and regular you are with your EMIs, your score either increases or decreases. There are many factors based upon which your Credit Score is decided and impacted, but the primary parameter is how likely are you to repay your loans or Credit Cards. For instance, whenever you apply for an SBI Personal Loan or Home Loan or Credit Card, the lender will check your credit score before processing your request.

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Now CIBIL rates your creditworthiness in a range of 300 to 900. A credit score of 800 or above is the best possible rating. Banks will practically run after you to make you borrow from them. A score between 699 to 799 is considered acceptable, scores just above 600 are considered rather poor, and any score below 550 is considered bad, and you will be rejected outright.

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CIBIL score goes up because of regular repayment of your loans and early payment of complete loans. CIBIL score can go down because of many reasons:

  • If you miss a payment on any of your loans for a stretch of time or on a regular basis.
  • If you have any debt settled without paying back the full amount.
  • If you have too much credit utilization i.e., you have taken too many loans or Credit Cards as compared to your total available credit.
  • If there are too many inquiries on your CIBIL score by lenders giving the impression that you are credit hungry.
  • If you actually have too many loans running at the same time, including too many unsecured loans your credit score can be impacted.
  • Too many rejected loan applications also worsen your credit score.

You can check your Credit Score from CIBIL directly or a number of financial services providers also give you the option to Check CIBIL Score Online for free. 

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How to apply for a Personal Loan with 600 CIBIL score?

You checked your Credit Score before you could apply for a Personal Loan and found that you are in 600 credit scoring range. This is a big setback but not all is lost yet. Following some basic steps, you can get a Personal Loan and start building up your Credit Score again.

  • Check for any discrepancies in your credit score and get them fixed. The score tracking system of CIBIL is much efficient but it is not made by the gods. There have been many cases where people get tagged to someone else’s debt and defaults and their credit score tanks despite no mistake of theirs. Check you detailed Credit Report and see that it contains only your debt. If you find any discrepancy with your Credit Report, get in touch with CIBIL online, through email or phone to get the score corrected. The process may take some time, usually a month but it does work wonders for the Credit Score of most people who have been hit because of someone else’s mistake. 
  • Show the lender that you have enough income to service the debt. Gather your salary slips or income statements for the last few months, preferably as far back as 12 months. The objective here is to assure the lender that you have the income with which you can pay your EMIs. In case you have recently received a salary increment, your new salary will be able to convince the lender that you can take care of your loan now. When the lenders see that you have a steady income, they will be more likely to give you a loan. 
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  • Get ready for higher interest rates and fees. People with Credit Score in excellent category get the best interest rates and lowest possible fees. Then there are people in the good category score who will get average deals in terms of processing fees and medium interest rates. People who are in the 600-credit score range tend to get rather high interest rates and their processing fees are also higher than other categories. You can negotiate with the loan agent to get some discounts but even they do not have much room to maneuver, so this is something you have to accept.
  • Ask for loan with a co-borrower or a guarantor. If you can get someone to sign up for the loan with you, the income that you make will be clubbed with the income of that person. This will act as a reassurance for the bank that there is someone responsible involved in the process who will take up the risk in case the original borrower defaults. The co-borrower or loan guarantor themselves must have a good credit score and steady income. If the second person also has a low credit score, the situation may go from bad to worse, so ensure proper creditworthiness of the second person beforehand.
  • Try asking for a lesser amount of loan. If you are rejected for a loan because of a lower credit score on a certain amount, there is a possibility that bank may have a lower credit score criteria for a lesser amount of loan. Check with the loan agent if you will be granted a lower loan amount. In most cases, this may be possible for people who can lower their loan asked amount to two-thirds or even half of what they originally asked for. 

In some cases, you may also be able to convince the lender to let you apply for a Personal Loan with NA or NH in your Credit Report. This is more of circumventing your credit score in the application so it is a hit or miss thing, but then, miracles have been known to occur. 

Do You Need Rs. 10,000 urgently as a Personal Loan?

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Category: Personal Loan