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Ankit was happy as his little princess finally got the admission to one of the most prestigious schools in town. Well, in order to secure her daughter’s admission, he was required to pay an upfront payment of ₹1,50,000. Ankit did not have the amount ready with him, hence he approached one leading bank for the same and applied for a loan. After 7 days, he followed up with the bank and what came as a shock to him is to know that his loan application has been rejected? Well, on inquiring the reason, he was told that he had a low CIBIL score as he previously defaulted with one lender.
Well, Ankit is not alone facing the loan rejection. There are several other borrowers as well who face the same ordeal while availing a personal loan to meet their varied needs. Now that we are talking about loan rejection, let’s just talk more about this. Defaulting on a loan is just one prime reason why lenders reject your personal loan application. But there are various other prominent reasons as well that give their share in the loan rejection. What if someone has no credit score? Didn’t understand the same? Let’s just brief you more about it…
Just like every coin has two sides, same goes in case of loans. There are some people who have never applied for a loan in their life. In that case, they have no credit/CIBIL score, as a result, most of the lenders find risky to give a loan to such applicants. And, finally, they have to face the rejection! But hang on! A poor CIBIL score or no CIBIL is not the dead-end of your credit needs. The good news is that there are plenty of renowned lenders that offer a personal loan to those who have low/no CIBIL. In fact, there are some banks who offer loans to even defaulters, and then there are some who give personal loan without CIBIL verification.
What happened, don’t you believe the same? Well, my friend, I know it is difficult for you to believe, but you will be glad to know that it is absolutely true! I know you must be wondering how is it possible that a lender offers the loan without even checking the CIBIL? Also, many people think that personal loan without CIBIL score check & loans for CIBIL defaulters might be the same thing.
So let me tell you buddy that both the things are different! Curious to know how? I am sure you are, aren’t you? Read the post below as we are here to give you the brief analysis on both.
Table of Contents
Personal Loan without CIBIL Verification Check
Getting a personal loan without CIBIL check might be possible if the income of an applicant is good, he/she works in a prestigious Fortune 500 company or applicant’s spouse credit score is high. Not only this, if you are a credit card user and you know how to use your card smartly by paying your dues timely without any default, it could also be a reason why lenders don’t go for CIBIL check even though you don’t have a loan history. The practice of paying the credit card bills timely ultimately helps in boosting your CIBIL, hence enhance your profile in the eyes of lenders.
If that is the case with you, wait for the good news to come as in that case some lenders might not check the CIBIL. However, usually in most of the cases, lenders do check the credit score of an applicant before availing the loan.
Personal Loan for CIBIL Defaulters
If we talk about personal loan for CIBIL defaulter, yes it is true that many reputed banks and financial institutions offer credit to such applicants by taking into consideration many factors. Individuals working in a reputed company and getting a handsome monthly income can grab the personal loan deal even though he/she is a defaulter. Well, you will be surprised to know that there are those lenders available in the market that offer personal loan for low CIBIL score. But here is a catch! These types of lenders offer the credit at higher interest rates. Yes, that’s right! The borrower have to avail the loan at higher rates and similarly have to pay the higher EMIs and interest as well.
It’s All About CIBIL Score- The Game Changer
However, personal loan without CIBIL score check & loans for CIBIL defaulters in both the cases an individual can get a personal loan because there is one thing which is common in both. Want to guess what it is? Well, it’s the CIBIL Score!
It is one such prime factor that shares a common connection in both the cases. However, in general, also, CIBIL is that key ingredient which plays a pivotal role in anyone’s loan journey. There is no denying the fact that maintaining a good credit history uplifts your CIBIL and allows you to grab the best loan deal in the future. In India, bureaus such as CIBIL, CRIF-High Mark, Equifax, etc gather data and score individuals which is further used by financial institutions. CIBIL is a representation of an individual’s credit worthiness and is calculated by these agencies after taking into consideration the debt and credit history of an individual. The score ranges 300 to 900 and having a CIBIL of 700-750 out of 900 is considered as good by most of the lenders.
In a nutshell, now that you have gone through the post above and understood both the cases, I think you would be able to differentiate how both the things are different. They are inter-linked but still different from each other.
Hope you find this post worth reading!
Happy Personal Loan Journey!