Personal Loan without CIBIL Score

When applying for a personal loan, your CIBIL score is one of the first things that the lender looks at. This information helps banks and lending institutions to evaluate your creditworthiness and repayment ability when you have applied for a personal loan. 

 

While this is true, it does not mean that individuals with no CIBIL score cannot qualify for a personal loan. If you don’t have a credit score, you may still be able to get a loan. Let’s find out how to get a personal loan approved despite having a low or no CIBIL score.

Here are some of the ways through which you can get a personal loan without a CIBIL score:

Opt for Collateral Based Loans

Personal loans are typically collateral-free and do not require security, but this applies primarily to individuals with a high CIBIL score. However, if your CIBIL score is low or nonexistent, you may be required to provide security for the loan.  You can pledge any of your valuable assets as collateral on the loan if you want to get an instant loan without CIBIL. Doing so will make it easier for you to obtain a loan from the lender of your choice.

Prove your Creditworthiness

To approve a loan application, a lender seeks a borrower with a strong credit profile. If you have a stable source of income, you can easily get a personal loan from any lender. Even if you have a low or no CIBIL score, providing your salary slip or bank statements as proof of income can help. This will assure lenders of your ability to repay the loan on time.

Get a Guarantor for the Loan

You can apply for the loan with the help of a co-applicant or a guarantor. It increases your chances of getting the loan approved. However, make sure the guarantor has a steady income. If your co-applicant is a family member, inform them beforehand regarding your intentions of getting a personal loan.

 

To successfully apply, the co-applicant needs to fulfill the KYC process. The lenders will then run a check through the bank statements and credit history and will most likely approve your loan application if the co-applicant meets the criteria.

Apply for a Lower Loan Amount

If you have a low credit score it's best to avoid applying for a higher loan amount. The lender may not be willing to sanction your loan since they may doubt your creditworthiness. Hence, it is advisable to apply for a lower personal loan amount since the interest rates charged on the loan will be less. This will ultimately increase your chances of getting the loan approved.

Request your Lender for a NA or NH on your Credit Report

Remarks for your credit history ‘Not Available (NA)’ or ‘No History (NH)’ may appear on your credit report when there is insufficient credit history. This means there isn't enough data to generate a credit score, which means you neither have a credit account, nor used credit in the past.

 

In such cases, you can discuss your credit history with your lender. The lender will consider your situation, and it's possible you may be offered a personal loan, though it could come with a slightly higher interest rate due to the lack of a credit history.

Check your Credit Report

It is always best to check your credit report as there are possibilities of errors in your credit statement. Such errors can have a direct impact on your CIBIL score. Hence, always check your credit score, and if you find any errors get it corrected as soon as possible. You can file a dispute with CIBIL regarding such errors. This will not only help improve your CIBIL score but will also make it easier for you to get a personal loan.

Consider Peer-to-Peer Lending (P2P)

In Peer-to-Peer (P2P) lending, you can borrow directly from another individual or investor without solely relying on traditional financial institutions. With this method, you can get a personal loan without depending on your credit score.

 

This can help you get loans at flexible terms with quick approvals. Depending on your profile, you may also get lower interest rates. However, it’s essential to carefully review the terms and conditions of the loan before proceeding.

CIBIL score is essential for accessing credit and managing your financial health. Lenders rely on this score to evaluate your creditworthiness and determine the risk of lending to you. A high CIBIL score, usually above 750, often can lead to quicker loan approvals, lower interest rates, and higher borrowing limits.

 

On the other hand, a low CIBIL score can lead to higher interest rates or even rejection of loan applications. Maintaining a strong CIBIL score is crucial for unlocking favourable credit opportunities and achieving your financial goals.

 

In case of late updating or wrong entries in the database by CIBIL may result in some borrowers losing out on acquiring loans. Hence, it is necessary for you to keep track of your credit report and maintain a good CIBIL score by making timely repayments. 

 

At Bajaj Markets, you can check your CIBIL score for free. Getting a score check done will give you a better understanding as to whether your personal loan application will be approved or not.