How to avail of an instant loan without CIBIL score?
When you apply for a personal loan, the CIBIL score is the initial parameter that lenders check. An excellent credit score assists you to meet your eligibility criteria when you apply for a personal loan without any salary slip or salary proof. This goes without saying the CIBIL score is highly essential if you are looking for financial assistance. CIBIL score defines the credibility of an individual, particularly when applying for a personal loan. It is an unsecured loan. However, with a lot of financial institutions providing new offers and schemes to make financial services accessible for individuals, availing of instant loans without CIBIL scores is possible today. Best banks for personal loans are usually PSUs as they offer loans at a lower rate, but few private sector banks too may offer the loan at a lower rate.
What is the CIBIL score?
For any loan with zero security or collateral, a CIBIL score check is done to decide the applicant’s eligibility. CIBIL score or credit score of other credit bureaus is a 3-digit numerical summary of business entities or individuals’ credibility. The score is maintained by Credit Information Bureau Limited and is utilized to evaluate whether the applicant has the potential to repay the loan amount within the due date. All the financial institutions and banks share their credit details with the CIBIL; depending upon this, the credit score is computed.
An applicant applying for a personal loan without proof of income or salary slip can also avail approval based on the credit score. However, the question is – can you avail an instant loan without CIBIL score or with a low CIBIL score?
What does a no or low CIBIL score indicate?
CIBIL score ranges anywhere between 300 and 900, and anything less than 750 usually is considered a low CIBIL score. As a personal loan is an unsecured credit option that does not need any collateral or security in return, they denote a greater risk for lenders. However, an excellent credit score indicates a history of on-time payments and is a testament to an individual’s credibility. It means that it is not possible to avail of a short- or long-term loan without CIBIL score. You can apply for a loan without an excellent CIBIL score, even if you have zero income proof or credit history, or both. Here are some crucial aspects you can factor in:
Low credit score and zero income proof: Ameliorate your credit score
CIBIL score is dynamic in nature and changes depending upon the latest credit info and debt repayment status of the individual. It means you can efficiently work towards improving your score before you apply for the loan. Timely repayment of your EMIs can make a lot of difference to your score. Having different kinds of loans on your name, maintaining old credit accounts, low credit utilization rate etc., are a few other parameters that ameliorate your CIBIL score. Once there is an improvement in your score, you can apply for the loan without any salary slip, as the approval is based on your credit score.
Have income proof but poor or no credit score: Avail loan depending upon your income
For individuals availing of their first loan, it goes without mentioning that they might not have any credit history. It is possible to avail of a personal loan without CIBIL score if you furnish steady income proof. However, such loans may be available at a high-interest rate. In such personal loan applications without CIBIL score, lenders might at times have specific eligibility needs such as income over the set limit, having been employed in the same company for a particular time etc. For any instant loan with no CIBIL score, your loan eligibility will be based on your income.
Low eligibility: Avail higher rate of interest
It can become tough to avail of a personal loan without both income proof and a CIBIL score. However, it is not impossible. Usually, if any individual is not able to qualify depending upon the CIBIL score or income check, the lender might ask for a higher rate of interest than others. Depending on the repayment tenure and your repayment potential, you can choose to choose a higher interest rate and avail of an instant loan without CIBIL score or income checks. However, you will require looking around for lenders with flexible eligibility for this.
Poor or no credit score and no income proof
If you do not have a credit history or in an instant requirement for the fund, do not have much time to improve your credit score or do not have income proof, there are various options for you:
Avail a joint personal loan
You can apply for a joint loan without a CIBIL score if your spouse holds an excellent credit score. When you apply for a joint loan, the CIBIL score of both loan seekers is considered. The next option to avail of a personal loan with a CIBIL score is to avail it in the name of your spouse. In this way, you can also avail of bigger loans such as home loans without an excellent CIBIL score at suitable interest rates.
Get a guarantor
In case you are facing any problem availing of a short- or long-term loan without a CIBIL score due to no credit history, you can get in touch with your instant families like your sibling or parents to become a guarantor for a personal loan. However, you will require ensuring that the individual who is acting as a guarantor has an excellent credit score. It is the most common way where seekers apply for a personal loan or education loan without a CIBIL history.
Consider putting up security or collateral.
A major personal loan feature is there are no limitations on the end usage of money. One of the prudent ways to avail of a personal loan without CIBIL score and income proof is to provide the lender with security in lieu of the loan amount. In India, gold is one of the most common forms of security put up by loan seekers to avail of an instant loan without CIBIL score check. Gold loans have become extremely common these days, and because the funds can be utilized for any purpose, more individuals are availing of this kind of instant loan. Without CIBIL score, security, or collateral to offset default risk for the lender.
Based on your requirement, you can put up assets like a vehicle, land, gold etc. The asset value will be ascertained by the lender, and the maximum loan amount based upon your eligibility will be computed. Even without a credit score, a loan is impossible to avail of. With so many offers and schemes available in the market, applicants have various options for availing of a loan without a credit score. Thus, if you are looking to avail a loan without a credit score or income proof, give it some time and look to find a suitable option.