CIBIL score
CIBIL score or CIBIL record is a very crucial part of everyone’s financial journey. It plays a very important role when it comes to determining a person’s eligibility in availing a loan or credit card. CIBIL score is basically a numeric representation of a person’s credit history. Financial institutions and banks depend on your CIBIL score while determining your eligibility for a loan or credit card. It is important that every individual maintain an average or above average CIBIL score in order to be eligible for credit. The average CIBIL score expected of an individual in India is 750 and above, anything below that is considered as a poor CIBIL score.
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CIBIL defaulters
Every step of your financial journey is recorded in your CIBIL record. If an individual has defaulted on loan payments and credit card payments, their name will be listed in the CIBIL defaulters list. Being a CIBIL defaulter is not a good sign and may lead to banks rejecting your application for loans and credit cards.
Personal loan for CIBIL defaulters in India
Though it is hard for CIBIL defaulters to avail loans and credit cards. There are a few banks and financial institutions that still grant loans and credit cards to CIBIl defaulters in India. Personal loans are usually the toughest to avail for CIBIL defaulters since the risk is higher for the lender when it comes to personal loans.
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How to avail a personal loan in India if you are a CIBIL defaulter?
Being a CIBIL defaulter is not considered as a good sign since banks and financial institutions are less likely to grant loans and credit cards to CIBIL defaulters. Listed below are the steps that an individual can follow in order to get a personal loan if they are a CIBIL defaulter.
- Opt for loans with higher rate of interest-Most of the banks and financial institutions and banks offer personal loans to CIBIl defaulters but at a higher rate of interest. Banks will be willing to offer the individual personal loans despite them being a CIBIL defaulter but only at a higher rate of interest.
- Collateral loans-Banks are most likely to focus less on your CIBIL report if you opt for collateral personal loans. Taking personal loan against collaterals such as assets, fixed deposits and shares will get the banks and financial institutions to ignore your bad CIBIL history or score.
- High income-An individual with a high income has higher chances of availing a personal loan despite being a CIBIL defaulter. A high salary indicates your ability to repay the loan. Banks tend to trust applicants with higher income more over applicants who earn an average income.
- Spouse’s CIBIL score-It can be tough to avail personal loans if you are a CIBIL defaulter and have a bad CIBIL score. Another way to avail personal loan in such a situation is by using your spouse’s CIBIL score to avail a loan. You can make your spouse a joint loan holder if they have a good CIBIL score for your personal loan.
Individuals who have availed a loan and are not in a position to repay it, are termed as CIBIL defaulters.
- 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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