How to Get a Personal Loan if you’re on the CIBIL Defaulter’s List
Your financial history is recorded in a report so potential lenders can gauge if you’re a responsible or unreliable borrower. One wrong move and you will witness a dip in your score. However, defaulting on your loan is one of the biggest financial mistakes you can make. When you stop making payments towards your loan, you’re registered in the CIBIL defaulter list.
Now, this can cause problems for you in the future. Banks and financial institutions will be wary to approve your loan or credit application. In some cases, you may not be able to access financial products for years on end.
So how do you get a personal loan if you’re a CIBIL defaulter?It’s important to know that major banks and financial institutions will be cautious before approving your loan application. Considering your history, you will have to pull up your credit score before you’re deemed eligible for another financial product.
While it’s much more convenient to get a loan from a bank, your options start wearing thin when you’re a defaulter. Listed below are some options you can look at if you need a personal loan for an emergency.

Secured Loan
One of the options you can opt for is a secured loan or a loan against collateral. If you have any assets or fixed deposits with your bank, you can request them to lend a loan against security. Usually, your credit score is not taken into consideration. However, if you do miss payments, the collateral you have pledged will be seized by your lender.
Loan Backed by a Guarantor
If you are now financially stable but your credit score isn’t, you may still get approved for a loan if you have a guarantor. This will remove the risk-factor associated with lending you money. You will need to make sure that your guarantor has an excellent credit score. However, note that if you default on this loan too, your guarantor will have to repay the outstanding balance. Also, their credit score will take a hit in case of default on your part. This is why many are apprehensive about being guarantors for loans.
To Know More About : CIBIL Score
Online Lenders
Since conventional banks and financial institutions may reject your application, you can always approach an online lender. You can get a loan from an online lending platform as they are a bit more lenient while dealing with applicants with low credit scores compared to banks. However, note that they too can reject your application if they consider you as a risk as most online lenders offer collateral-free loans.
Withdraw Provident Fund
There’s a reason this fund was introduced in the first place—to ensure your retirement is secure. However, if you’re in a financial crunch and are in desperate need of money, you can consider withdrawing your provident fund. Now, you’re only allowed to withdraw this fund partially under certain circumstances.
Salary Advance
Again, if you’re in a financial crunch, you can always request your employer for a salary advance. You will need to justify your ask with valid reasons for your employer to consider your request. Being in the CIBIL defaulter’s list is going to create barriers. Before you decide to take an additional loan, you should attempt to clear the loan you’ve defaulted on. You should also find a way to clear your name from the list and improve your credit history, which will then improve your CIBIL score.
While there are ways of securing a loan as a defaulter, it’s advised to have a clean financial record before you burden yourself with another loan.
FAQ's on CIBIL Defaulter
- Is there a CIBIL defaulters list?
- For how long CIBIL keeps the record of the defaulters?
- How to remove your name from CIBIL defaulter?
- Can CIBIL defaulters avail any loan?
No. CIBIL does not maintain a defaulters list. It only maintains the credit history of individuals. It must be noted that banks do not rely on any defaulters list at the time of granting a loan.
The CIBIL Credit Information Report (CIR) contains an individual’s details of the defaults. This record is with CIBIL for a period of minimum 7 years. The CIR does not include any records that are over seven years old.
It is better to first check whether there is an error in your credit report that has made you a defaulter. Another reason could be due to settling a credit or defaulting a payment towards a credit. It must be noted that even late payments result in adverse impact on your credit.
It is not easy for CIBIL defaulters to avail loan from banks and lending institutions. The chances of getting a loan approval are low in case you are a consistent defaulter. However, people can still get a personal loan despite having a low CIBIL score.
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TransUnion CIBIL is one of the leading credit information companies in India. The company maintains one of the largest collections of consumer credit information in the world. CIBIL Score plays a key role in the lives of consumers. Banks and other lenders check the CIBIL Score of the applicants before approving their loan or credit card application. Consumers can visit the official website of CIBIL to check their CIBIL Score and Report. CHECK YOUR CIBIL SCORE now.