CIBIL score is a three-digit number that ranges from 300 to 900, with 300 being the lowest and 900 being the highest. Credit rating agencies like CIBIL assign this score after evaluating your credit repayment history.
This three-digit number summarises your credibility as a borrower. So, when you apply for an unsecured loan like a personal loan, this is one of the main considerations.
However, you only get this score after you have taken credit and repaid it. So, if you are a new borrower, who does not have this score, you can get a personal loan without CIBIL score if you keep a few pointers in mind.
How to get a personal loan without CIBIL score?
Here are some tips to follow to get personal loans without a CIBIL score –
- Prove your repayment capacity
Personal loans are unsecured loans with high credit risk. Therefore, financial institutions always look at the repayment capacity of an applicant before approving the loan application. So, even if you do not have a CIBIL score, you can still convince a lender if you can prove that your income is enough to make the payments on time.
In this regard, to better your chances, you can include your additional sources of income along with your regular source of earnings. It can include income from rent, interest, dividends, and any other investments.
- Apply for the right loan amount
When you do not have a CIBIL score to convince a lender that you can manage a loan, applying for the right amount is crucial. Since you are a novice borrower, your chances of rejection are high if you apply for an excessive amount.
Therefore, applying for a loan matching your repayment capacity is the easiest way. You can take the help of an online EMI calculator and check the loan amount for which you can comfortably manage the repayment and then apply accordingly.
- Get a longer repayment tenure
Another easy way to get personal loans without a CIBIL score is by applying for a longer repayment tenure. Since an extended payment term reduces your EMIs, it will not stretch your finances, and you can easily accommodate them in your budget. Since you will prove your repayment capacity, you may convince the lender to approve the loan application.
- Get a co-borrower
Getting a co-borrower is another way to get personal loans without a CIBIL score. If any of your family members or partners have a CIBIL score, you can ask them to apply with you. Since the co-applicant will have a credit history, and their income will increase the total repayment capacity, the chances of receiving a loan approval will also improve.
However, if both applicants do not have a CIBIL score yet have a regular source of income that fulfils the financial institution’s requirements, it will reassure the lender of timely repayment and get you the loan.
- Apply with a financial institution you have a working relationship with
When you do not have a CIBIL score, it isn’t easy to convince lenders to extend your credit. However, if you go to a financial institution with which you already have a working relationship, you may get a loan.
Since you are an existing customer, it can persuade the financial institution to approve your loan application. But you need to meet eligibility parameters and submit the required documents without fail.
You need to remember these points when you want to apply for personal loan without having a CIBIL score to avoid rejection. However, you can always improve your CIBIL score by following a few handy tips.
Top 3 tips for building your CIBIL score
Here are some ways you can quickly build your CIBIL score –
- Always pay your dues on time. Once you get the personal loan, make sure you repay on time and close the loan successfully.
- Use a credit card and pay the bill diligently. It will also build your CIBIL score without any hassle.
- Opting for secured loans is another idea to build your CIBIL score. Since you don’t need to pursue the lender hard to get this category of loans, they are an excellent way to start.
Final Thoughts
Even if you do not have a CIBIL score, getting a personal loan is possible. When you plan correctly and meet the eligibility parameters set by the lender, there is a chance that you will qualify for it. Moreover, exercise the pointers mentioned above to build your CIBIL score and apply hassle-free.
