Personal Loan for Low CIBIL Score of 600
A CIBIL score measures your credit history and repayment behaviour, typically 300 to 900. A higher score signifies better creditworthiness, while a lower score, such as 600, can pose challenges in securing a personal loan. However, it’s not entirely impossible to secure a personal loan with a CIBIL score of 600.
Certain financial institutions go beyond just looking at your credit score. They consider other factors such as income, employment status, credit report, loan amount, and co-applicant. This holistic evaluation enables lenders to gauge your overall financial stability and repayment capacity based on the common scene, not just a computer-based number. Thus, they might be more willing to offer the necessary funds, possibly with better rates and terms. To know more possibilities of getting a personal loan for CIBIL Score 600, let’s scroll down.
How to Get a Personal Loan With a CIBIL Score of 600?
You can follow the steps given below to get a Personal Loan for a CIBIL Score of 600:
- Showcase all your income sources
- Apply with co-applicants
- Settled your existing debts
- Apply for a lower loan amount
- Opt for a longer repayment period
Personal Loan Options for a CIBIL Score of 600
Let’s examine the available options concerning a personal loan for a CIBIL score of 600:
Apply With a Guarantor: A guarantor is a person who commits to settling the loan if you fail to make payments. Securing a guarantor with a strong credit history and a stable income can enhance your likelihood of obtaining a personal loan, particularly if your CIBIL score is low.
Apply With a Co-applicant:
A co-applicant is someone who applies for the loan with you and shares the responsibility of repaying it. This can be your spouse, parent, sibling, or anyone close to you. Including a co-applicant with a favourable credit score and a better income can enhance the chance of getting approved for your loan application.
Apply for a Secured Loan: A secured loan involves submitting collateral, such as property, a vehicle, gold, or a fixed deposit, to secure the loan. Doing so reduces the lender's risk, making them more willing to approve your loan application, even if you have a low credit score.
Apply for a Peer-To-Peer Loan: A peer-to-peer loan is a facility that allows you to borrow money via an online platform that connects borrowers and lenders directly. This eliminates the necessity for intermediaries like banks or NBFCs, providing you the opportunity to negotiate loan terms and interest rates directly with the lender.
Eligibility Criteria for Low Credit Score 600
The following are the typical eligibility criteria regarding a Credit Score of 600 for a personal loan:
- You must be somewhere between 21 years and 60 years old.
- You must be either a salaried or self-employed individual.
- You must demonstrate a regular source of income that covers the loan repayment.
- You must be an Indian citizen.
Documents Required for Personal Loan for Low CIBIL 600
The following is the common documentation regarding a CIBIL Score 600 for a personal loan:
- Proof of Identity: PAN Card, Passport, Voter ID or Driving License.
- Proof of Address: Utility Bills, Passport, Driving License, or Aadhaar Card.
- Proof of Income: Bank statement, salary slip, tax return, or income certificate.
- Proof of Employment: A formal letter from your employer or documentation affirming your business ownership.
Challenges With a CIBIL Score of 600
Let’s take a look at the major challenges of having a low CIBIL score of 600:
- Difficulty in securing loan approval
- Available limited credit options
- Increased interest rates and unfavourable terms
- Potential impact on future credit scores
What Are the Factors for a Low Credit Score?
The following are the applicable factors for a low credit score:
- Payment History: Failure to make timely payments on your loan or credit card can adversely affect your credit score, indicating that you are not reliable in repaying your debts.
- Credit Utilisation: Using too much of your available credit can decrease your credit score, suggesting that you face potential challenges in managing and repaying debt.
- New Credit: Multiple new loan applications in a short period can lower your credit score, signifying that you need more credit and may pose a higher risk of default.
How to Improve Your CIBIL Score Above 600?
The following are certain tips you may keep in mind to improve your CIBIL Score above 600:
- Resolve your existing dues
- Reduce your credit card utilisation
- Avoid multiple loan applications
- Keep your old bank accounts open
- Review your credit report regularly
How to Apply for a Low CIBIL Personal Loan From Uban Money.
The following are the steps to apply Personal Loan for CIBIL Score 600:
- Visit the official website of Urban Money.
- Tap on the “hamburger menu” icon.
- Opt for the “Loan” option, then select the “Personal Loan” option.
- You will be directed to a new page to view an array of lenders across India.
- Locate the one you wish to apply and click the “Enquire Now” button.
- A small digital form will appear on your screen, prompting you to put your name, mobile number, and the city you reside.
- Once you have completed the form, click the “Submit” button.
- A 6-digit OTP will be sent to your mobile number.
- Enter the OTP and once again click the “Submit” button.
- Within a day, a representative from Urban Money will contact you and guide you until the funds hit your applicable bank account.
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Frequently Asked Questions (FAQs)
What is the Minimum CIBIL Score for Loan Approval?
Individuals with credit scores between 600 and 700 or above are typically deemed eligible for personal loans. However, some lenders are willing to offer personal loans to applicants with credit scores as low as 600.
Is 600 a good CIBIL score?
No, a credit score of 600 is considered poor.
Can a CIBIL Score of 600 be Improved?
Yes, you can improve your credit score from 600 by following to these tips: pay your dues on time, keep your credit utilisation low, avoid multiple loan applications, check your credit report regularly, and rectify any errors you may find.
How do you choose the right personal loan with CIBIL 600?
You can choose the right personal loan with CIBIL 600 via Urban Money. We have a more than 50 lenders network, including banks, NBFCs, and P2P platforms, providing personal loans designed for various credit profiles.