Minimum CIBIL score required for Personal Loan
An Overview on CIBIL ScoreCIBIL score is a 3-digit numeric summary of the credit information report and is based on past credit behavior and repayment history, credit mix, and credit inquiries. The higher your CIBIL score, the better are the chances of your loan getting approved.
Before offering personal loans, the majority of the lenders check the borrower’s monthly income and credit history. Since personal loans are unsecured loans, lenders particularly look at your repayment history and CIBIL score to avoid defaulters.
However, some lenders may consider your CIBIL score on your present repayment history. If you are a first-time personal loan applicant, only your monthly income and last 6 months of bank statement are deemed essential.
Hence, it is advisable to be vigilant about your CIBIL score regularly and ensure there are no errors and the overall report looks advantageous to the lender.
Why is a CIBIL score considered necessary for a Personal loan?A personal loan is a collateral-free loan that does not require pledging any security against the loan, unlike a home loan. A personal loan is sanctioned after analyzing the credit score of the borrower. It is where the CIBIL score plays a vital role and is considered important for a personal loan. Transunion CIBIL Limited, earlier known as Credit Bureau of India, maintains a record of payments related to loans and credit cards.
How can borrowers improve CIBIL scores for personal loan approval?
If your CIBIL score happens to be low or zero, improving certain factors will help to get your loan approved:
With a stable income of at least 15,000 per month, salaried and self-employed individuals are eligible for a personal loan.
Decent income -
Consistent payment of taxes -It gives a decent impression of your financial profile if you are paying the taxes regularly. Even if your CIBIL score happens to be minimum, the lender may approve the loan weighing your consistent payment patterns.
Lessen your loan amount -In case your CIBIL score happens to be low, there is chance that you may be eligible for a slightly lesser loan amount. However, the rate of interest, in this case, maybe on the higher side.
Repay your debts on time -Remember to repay all your EMIs as well as other obligatory bills or credit card bills on time to build a good CIBIL score. Most lenders facilitate automatic ECS so that the EMI amount gets automatically debited on a designated day of a month. As a result, there are no missed payments and the minimum CIBIL score required for a personal loan remains undamaged.
How do you check your CIBIL Score?
You can check your CIBIL Score by visiting www.cibil.com and following the below mentioned simple steps:
- Enter your personal details like PAN card number, Date of birth, gender, etc.
- Complete the identity verification process
- Confirm the OTP sent on your smartphone or Email Id
- If the CIBIL score is checked more than once, you may have to make a fee payment to access the report
- Check for the best personal loan offers available for you.