You may need a personal loan for a low CIBIL score to pay large or modest bills if you run out of money. The majority of lenders do a credit check. When you apply for a personal loan various factors are considered such as your credit history, credit limits, repayment abilities, etc. Additionally, because a personal loan has no collateral, lenders look at your credit score to see if lending to you is risky.
It is a common misconception that individuals with a low credit score cannot obtain a personal loan. However, lenders such as Loaney provide personal loans to consumers with even the lowest credit scores.
Do you require a personal loan yet have a low CIBIL score? Read this article to get a personal loan for a low CIBIL score. Towards the end of this article, you will get to know how to secure a personal loan for CIBIL score of 550 near the end of this article.
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What Is CIBIL Score For Loan?
The CIBIL score is a personal identification number that provides information about your credit repayment history and debts. Therefore, it is a beneficial indication for determining loan acceptance. In addition, because it was India’s first credit rating system, all banks regard the CIBIL score as a source of information on a person’s credit rating. Therefore, the CIBIL score is primarily used by banks and other financial institutions to determine your creditworthiness.
Now, let’s try to understand how you can get a personal loan for a low CIBIL score. Read along!
Why Is CIBIL Score Important For Personal Loans?
CIBIL is a well-known credit bureau that provides credit scores to customers looking to borrow money. These ratings are usually based on an individual’s financial history and indicate their repayment habits. Credit scores typically vary from 300 to 900, with higher scores indicating a more substantial credit history.
As previously stated, CIBIL plays an integral part in obtaining loan benefits from lenders, such as Loaney. A low CIBIL score personal loan might make it challenging to get loans, such as a credit card or a home loan. A credit score of 750 is regarded as optimal, and those with this score have a better chance of getting loans. A personal loan for CIBIL score of 550 or lower, on the other hand, can make getting a personal loan problematic.
What Are The Reasons For Low Cibil Score?
Low CIBIL scores are not uncommon. You could have a low CIBIL score due to several reasons. A low CIBIL score can make it considerably difficult for your loan application to be approved. Before we understand the effects of low CIBIL scores and how the score can be improved, let us understand the reason for a low CIBIL score. The following can be the causes of a low CIBIL score:
- Past Payment Records: Payment history is one of the major factors that impact your CIBIL score and credit report. Delayed or missed payments of even the smallest amounts can lead to a decrease in CIBIL score.
- High Credit Utilization Ratio: credit utilization of more than 30% of the total credit limit can cause a decline in your credit score.
- Multiple Loans: Applying for and borrowing multiple loans within a short duration of time can be harmful to your CIBIL credit scores.
- Too Many Unsecured Debts Borrowed: While borrowing loans, you must make sure to maintain a balance between secured and unsecured debts.
- Error in CIBIL Report: You must keep a regular check on your CIBIL score report to make sure there is no error in the same that indicates low scores.
- No Credit History: Not having any records of loans borrowed previously or credit-related activities can also lead to a low or 0 CIBIL score.
Now that you know the causes of a low CIBIL score, you can work on some of these aspects for a better score and hence an easier loan application and approval. Further, we will be looking at the effects of having a bad credit score and how the score can be improved.
Understand the cibil score impact on loan: How does the cibil score affect eligibility for a loan?
The CIBIL score is a reflection of your past credit-related activities and borrowing history. This 3 digit number ensures the lender that you will be repaying your loans on time and will not be a risk to the lender and the lending organization. The eligibility criteria of borrowing loans mention that the borrower must have a CIBIL score of at least 750. The CIBIL score is calculated between 300 to 900.
As per the eligibility criteria, you cannot borrow a loan if you have a very low CIBIL score. A low CIBIL score is a problem for you if you are considering borrowing an instant loan. Having a bad credit score makes it difficult for the borrower to apply for a loan and get it approved. The loan approval takes longer than usual. In case the loan application does get approved, the borrower will have to pay a higher interest rate for the same amount.
This makes instant loan borrowing more of a financial problem than a solution in times of emergency. This is what makes having a good credit score important. A low CIBIL score does not guarantee that you will not be offered a loan. You can borrow smaller amounts of loans offered by various online platforms as instant personal loans. This instant loan for a low CIBIL score can be useful if you have a poor credit record. In the upcoming sections, we will help you understand how you can borrow a short-term loan without CIBIL and even use the borrowed amount to fix your low CIBIL scores and bad credit reports.
How To Get A Loan With A Low CIBIL Score?
Are you having a low CIBIL score and need a personal loan for CIBIL score of 550?
Getting a personal loan is challenging but not impossible when you have a bad credit score. Many lenders may provide you with a personal loan even if your CIBIL Score is low. Many financial institutions are increasingly lending to people with bad credit:
- Loaney
- Loanbaba
- Vintage Finance
- Lendbox
- Home Credit
Remember to search around before choosing a lender, and if you do acquire a personal loan, make sure you pay it back on time to improve your credit score progressively.
Need A Personal Loan With A Bad CIBIL Score? Apply On Loaney
There are situations when you must need urgent cash, but you have a low CIBIL score; in this situation, you must keep certain things in mind when choosing a lender. It has become accessible in today’s world to avail of credit through low score credit loan apps, but you must know that the lender is reputable to prevent any fraud. Specific lenders like Loaney can help you avail of urgent cash loans if you have a low CIBIL score.
Here’s How You Can Get A Loan With Low CIBIL Score From Loaney
Listed below are the steps to avail loan for low CIIBIL score from Loaney with a low CIBILscore:
- Completing The Application Form:-
Filling out an application form is the first step in getting a fast cash loan. It comprises several fields that each demand specific information about the applicant.
- Personal details: Includes the applicants’ details such as the applicant’s permanent address, contact number, marital status, current residential information, and others.
- Employment details: Information such as whether the applicant works full-time, part-time, or is pursuing their education, the employer’s details, current wage, and others are included in this section.
- Self Employment details: When an applicant is not associated with an organisation, they will be required to provide information about their firm.
These are the essential requirements for completing an application for a personal loan for low CIBIL score.
Why Get An Instant Loan For Low CIBIL Score From Loaney?
Your CIBIL score has a significant impact on your loan eligibility. Use a personal loan eligibility checker to determine how much money you can borrow and how much you will be paying in EMIs. Check your CIBIL Score. This can be accomplished fast and easily using the internet. Your chances of acquiring a personal loan enhance if you have a good to exceptional credit score. If you have a terrible credit score, you might be able to get a loan, but it will come with a considerably higher interest rate.
Eligibility Criteria For Loaney Low CIBIL Score Personal Loan
Let’s look at the requirements for getting a personal loan for low CIBIL score from Loaney in India. To avail that, the applicant must meet the following criteria:
- The candidate must be an Indian citizen over 18 and have a PAN and Aadhar card.
- The petitioner earns between Rs. 25,000 and Rs. 30,000 per month. A verified entity must approve and certify this source of revenue.
How to improve cibil score? 5 ways you can improve your cibil score
To improve your credit report and increase your CIBIL score to a minimum of 750, you can follow some easy steps. This will help you avail of an instant loan easily with a good CIBIL score. For a better credit report, you must:
- Complete all your payments in time and as scheduled.
- Repay all the borrowed debts and pay your bills on time.
- Maintain all your old credit accounts to have a credit history.
- Avoid taking too many loans and applying for a lot of loans at the same time.
- Not close the paid-off accounts.
If you follow the above steps, you will be able to easily increase your CIBIL score for availing of an instant personal loan.
Conclusion
We hope we have helped you get an insight into availing personal loan for CIBIL score of 550. Also, with Loaney you can get a low CIBIL score personal loan. Towards the end of this article, you can find some of the most commonly asked questions on getting a personal loan for low CIBIL score from Loaney.
And if you need a loan for low CIBIL score, please feel free to contact us.
Frequently Asked Questions For Availing Loan With A Low CIBIL Score
Here are some of the most frequently asked questions on availing of a loan for low CIBIL score:
1.How to get a loan with a low CIBIL score?
You can get a low CIBIL personal loan by:
- Fixing any mistakes on your credit report.
- Showing proof of income to back up your loan repayments.
- Considering taking out a small personal loan.
- Request that your lender evaluates your case if your credit report shows a NA or NH.
- Requesting a joint loan or a guarantor.
2. What is a good CIBIL score for a loan?
When your CIBIL Score is between 700 and 900, it is regarded as good and shows that you are creditworthy.
3. What is the minimum CIBIL Score to get a personal loan?
A CIBIL score of 720 to 750 is required for a personal loan. Your loan application will be approved based on your credit score. They might even consider lending the money at a lower interest rate.
4. Can I get a loan with a CIBIL score of 550?
You can acquire a personal loan for CIBIL score of 550 because many lenders are now lending people with bad credit.